During the present era of financialization, there has been a widespread tendency towards higher economic and social inequality. United Nations (2020: 1) summarize this in the following terms: “Since the 1990s total global inequality (inequality across all individuals in the world) declined for the first time since the 1820s.” The United Nations notes that income inequality between countries has improved in the past quarter of a century, with average incomes in developing countries increasing at a faster rate than developed industrialized countries, much of which comes from the rapid economic growth in China and other emerging economies of Asia. However, since 1990, income inequality has increased in most developed countries and also in emerging economies such as China and India. It reports that, while income inequality between countries has declined, income inequality within countries has risen. The report finds that, in the late 2010s, 71 per cent of the world's population lived in countries where inequality had grown in the preceding three decades.

“While inequality has increased within most countries, over the past two decades, global inequalities between countries have declined. The gap between the average incomes of the richest 10% of countries and the average incomes of the poorest 50% of countries dropped from around 50x to a little less than 40x. At the same time, inequalities increased significantly within countries. The gap between the average income of the top 10% and the bottom 50% has almost doubled, from 8.5x to 15x.” (World Inequality Lab 2021: 10).

On a global level, at the beginning of the 2020s, the share in income (on a purchasing power parity basis) of the bottom 50 per cent is estimated at 8.5 per cent, the middle 40 per cent and top 10 per cent have shares of 39.5 per cent and 52 per cent, respectively. Inequality of wealth is much sharper, with the bottom 50 per cent having a 2 per cent share, the middle 40 per cent a 22 per cent share and the top 10 per cent a 76 per cent share.

There have also been shifts in the distribution of income in general away from wages and towards profits. These trends are briefly illustrated in the next section.

In the background to this chapter is the general belief that the degrees of inequality in a society are rather important dimensions of economic and social well-being.