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HUMANITY DIVIDED Confronting inequality in Developing Countries Almudena Fernandez, Bureau for Policy and Programme Support, UNDP Dialogue on Inequality, Istanbul 21 January 2015
1 Outline 1 Conceptual Framework 2 Inequality in developing countries: what has happened and why 3 Policy framework
Taking the debate forward
5/29/2015 Footer Text 4 ? INEQUALITY: WHAT HAS HAPPENED AND WHY
Income Inequality changes in Developing Countries Income Inequality rose by 35% in Eastern Europe and the CIS and 13% in the Asia the Pacific Meanwhile, it fell in both Sub-Saharan Africa by 7% and in the Latin America and Caribbean region by 5%. Source: UNDP, Humanity Divided
Economic performance and income inequality LOW INCOME LOWER-MIDDLE INCOME UPPER-MIDDLE INCOME
Drivers of income inequality
Not every country that had above average growth during this period saw inequality rise. And not every country with below average growth saw inequality fall. In the last 20 years, of 24 developing countries with above average growth (3% or more), 11 countries experienced an increase in inequality but 13 countries were able to maintain or lower inequality. Do we have to sacrifice faster growth for greater equity?
The Redistributive Impact of fiscal policy in Developing Countries In the majority of countries, taxes and transfers had an inequality reducing effect. The average redistributive impact of taxes and transfers was 11% in Upper-Middle Income countries, 4% in Lower-Middle and 3% in Low-Income countries. Yet, country experiences vary widely. Even among low and lower middle income countries there are cases where taxes and transfer reduce inequality by more than 30% Source: UNDP, Humanity Divided
Income inequality is related to inequality in well-being Under-5 mortality rates are higher by more than 50% for children in the bottom wealth quintile as compared to children in the top wealth quintile, in all regions Women from the bottom wealth quintile are up to 9 times more likely to be malnourished compared to women from the top wealth quintile Source: UNDP, Humanity Divided
Gender inequality has declined for some indicators. The F/M ratio of total years of education increased, on average, from 82% in 1990 to 91% in 2010. The global ratio of F/M employment rates rose from 62% in 1990 to 70% in 2010. Exception: Worsening job segregation in industrial sector. Wage gaps remain large and widening in many countries. 5/29/2015 Footer Text 11 Gender Inequality
Reasons to be concerned about trends. Employment equality substantially lags educational improvements. Closing educational gaps not sufficient in order to achieve gender equality. Gaps in political representation remain wide. Public policy does not reflect women’s life conditions and perspective in allocation of resources. 5/29/2015 Footer Text 12 Gender Inequality
5/29/2015 Footer Text 13 ? HOW TO ADDRESS INEQUALITY
A COMPREHENSIVE POLICY FRAMEWORK
You can download the report at: http://on.undp.org/vLKqj 5/29/2015 Footer Text 15 Thank you