The average income of the richest 10% of the population is about nine times that of the poorest 10%, up from seven times what it was 25 years ago. Even in more egalitarian countries, such as Germany and Sweden, the earnings of the richest are over six times higher than those of the poorest, compared with just over three in 1985. Inequality has narrowed in countries like Chile and Mexico, though the income gap between rich and poor is still 27 to 1, and in Brazil, which as this edition shows has implemented impressive programmes against poverty and inequality, the gap stands at 50 to 1. Clearly, the benefits of economic growth have not trickled down or been fairly distributed.
Why does this matter to policy makers? Inequality is a critical social and economic challenge. Widening disparities weaken the structures that hold our societies together and threaten our ability to move forward. This effect has become even more apparent with the current prolonged crisis, which has been felt by a wide range of income groups throughout the OECD area.