Income Inequality Us Vs Europe
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The difference largely though not entirely reflects the eu s failure to coordinate a continent wide economic stimulus following the 2007 2008 financial crisis.
Income inequality us vs europe. This paper discusses the levels trends and causes of income inequality in europe and the us. Income inequality has grown more rapidly in the united states than in europe share of national income going to the top 1 and bottom 50 of income earners since 1980 bottom 50 of earners top 1 of. Overall us incomes have grown faster than those in europe over the past 40 years. Data from 2016 show wide inequalities in the distribution of income.
Judith niehues 28 september 2014. Between 1980 and 2017 average national income per adult grew by 65 in the us compared to 51 in europe. The economic collapse of post communist countries after 1989 led to a rapid increase in income inequality among the combined group of citizens of the current 28 eu members until 1993. In the eu the top 20 of the population with the highest income received 5 2 times as much income as the bottom 20.
Income inequality is high in the us but the support of social welfare programmes is low. On the one hand it finds that although market income inequality has generally risen. In 1980 these blocs of similar population and average income were also similar in income inequality. In 1980 the top 1 percent s share of income was about 10 percent in both western europe and the us but since then the two have severely diverged.
Many europeans believe that there is high inequality in their countries. The top 1 captured around 10 of national income while the poorest 50 took around 20. This ratio varied considerably across the member states from 3 5 in the czech republic and 3 6 in slovenia slovakia and finland to 6 0 or more in bulgaria 8 2 lithuania 7 1 romania 7 0 in 2017. Income inequality among european union citizens has previously shown strikingly different developments compared with income inequality among united states citizens.
Latin america and africa have the highest inequality with a gini of 48 82 and 44 26 respectively whereas europe and more advanced economies have lower income inequality. Consistent with the results of the figure the table shows a negative correlation between the level of income per capita and the gini coefficient to some extent.
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