gran therborn

DYNAMICS OF INEQUALITY

I
nequality is a modern notion. Differences in wealth, power
and statusbetween rich and poor, men and women, young and
oldare ancient, of course. The great salvationist religions
Buddhism, Christianity, Islamadumbrated notions of the
equality of human souls, which could sometimes develop into an egali-
tarianism rooted in this world, rather than the next: the celebrated
defence of Americas native population by the Spanish priest Bartolom
de las Casas, for example, or the anti-slave trade campaign of Anglo-
Saxon abolitionists. It supplied an inspiration for popular uprisings,
from the German Peasant War of the 1520s to the great Taiping and
Tonghak rebellions in nineteenth-century China and Korea. A Biblical
extrapolationWhen Adam delved and Eve span, who was then the
gentleman?was popular in many European languages. But the mod-
ern, secular concept of equality was forged in the course of the struggle
waged by Europes bourgeoisie against the ruling aristocracya struggle
in which the official Church and its high clergy, of whatever variant of
Christianity, opted for the latter, and later paid the price in the unique
secularization of most of Europe.

The bourgeoisies struggle focused on existential equality in its legal form,

challenging the privileges of the aristocracy and its claim, most salient in
France, to be a superior type of human being to mere commoners. But
this civic equality among the propertied and educated gentlemen of the
Atlantic revolutions was soon challenged to the point of extinction by the
convulsive social polarizations of industrial capitalism. Social inequality
entered the political arenaand the intellectual agenda. But if equal-
ity may be seen as the defining value of the modern left, as Norberto
Bobbio has argued, within working-class, progressive-nationalist and
feminist movements it was usually embedded in and subordinate to
other conceptsemancipation, liberation, socialismor sat alongside

new left review 103 jan feb 2017 1

 2 nlr 103

concrete demands for jobs, fair wages, social security, sexual freedom,
national independence, and so on. Now that several of these concepts
have lost their self-evident character, while inequalities are mutating into
new, more vigorous forms with the crumbling of their old institutional
bulwarks, critiques of inequality and concerns with equalityas a pro-
cess and a horizon, rather than a stateare becoming more central. It
was Amartya Sen who, in this context, posed the question, Inequality
of what? and answered: Of possibilities for human functioning.1 He
thereby provided egalitarianism with a sustainable theoretical basis,
relevant both to social philosophers, lost in the utopian nationalism of
Rawlsthat is, the radical utopianism of his Theory of Justice and the
philosophical nationalism of his Law of Peoplesand to latterday econo-
mists, blissfully ignorant not only of Marx but also of Ricardo.

On this view, inequality is a historical construct. Under the present global

order, the majority of humankind are deprived of the potential to realize
their full capabilities. Six million children die annually before their fifth
birthday; the chances of survival for those born into the worlds poorest
20 per cent are only half those for the richest quintile. In India, almost
half the population suffers from physical and mental stunting in child-
hood, a handicap from which many will never fully recover. In Britain,
too, the class imprint on babies is visible by the age of 22 months. In this
sense, inequality is perhaps the biggest crime against humanity. Sens
approach has been statistically codified in the Human Development
Index produced by the un Development Programme, focusing on the
dimensions of life expectancy, education and income. In recent years,
the undp has also begun to calculate inequality of development within
nations and regions: Sub-Saharan Africa fares worst overall, followed
by South Asia; income inequality is highest in Latin America, educa-
tional inequality worst in South Asia and life expectancy most unequal
in Sub-Saharan Africa.2

A pioneer

Over the past twenty years, inequality has again become a majoror at
least, non-negligiblepreoccupation for economists; the 2008 financial
crisis even put it on the agenda of the capitalist World Economic Forum

1
Amartya Sen, Inequality Reexamined, Cambridge, ma 1992.
2
undp, Human Development Report 2015, table 3.
 therborn: Inequality 3

in Davos. In a us-dominated profession, this egalitarian surge has

largely been driven by Europeansalthough many work at American
institutions.3 For many years a doyen in the field was the Nuffield-
based Anthony Atkinson, a sharp-eyed British empiricist; from France
there is the developmental economist Franois Bourguignon, a former
chief economist at the World Bank, the economic historian Christian
Morrisson, the economist-cum-historian Thomas Piketty and his some-
time collaborator Emmanuel Saez, now at Berkeley; Italians include the
global researchers Giovanni Andrea Cornia, formerly at unicef, and
Andrea Brandolini; we should also include circumspect Dutch economic
historians, like Jan Luiten van Zanden.

But for the lay person with a global perspective, the most interesting
and important of these analysts of inequality is Branko Milanovic.
Born in Yugoslavia in 1953, Milanovic trained as an economist at the
University of Belgrade, where his earliest research centred on workers
self-management. His doctoral dissertation, completed in 1987, exam-
ined economic inequality in Yugoslavia, pioneering the use of micro
data from household surveys there. In the early 90s he moved to the us,
joining the World Banks research department, and from 19962007
taught at jhu. His first major work demonstrated the rise of inequality
in Eastern Europe with the restoration of capitalism there (or, in polite
liberal lingo, the transition from planned to market economy).4 Now at
cuny, Milanovic has made his name as an empirical analyst of the total-
ity of global economic inequalityin contrast, for example, to Piketty,
who concentrates on the national income shares of the richest 10 to 1 per
cent of selected countries populations.

In 2005, Milanovics Worlds Apart distinguished three different con-

cepts of global inequality. The first compared the different countries of
the world in terms of gdp per capita. This un measure of inequal-
ity remained basically stable from 1950 to 1980if we discount a blip
around 1960, when a number of African countries became independent

3
The American economist Joseph Stiglitz has become an influential critic of
inequality with his 2011 Vanity Fair article, Of the 1%, by the 1%, for the 1%, but his
main work has been focused elsewhere. The most important research on inequality
by contemporary American economists is being done at Chicago (of all places) by
James Heckman, discussed below.
4
Branko Milanovic, Income, Inequality and Poverty during the Transition from Planned
to Market Economy, World Bank, Washington, dc 1998.
 4 nlr 103

and were thus included in the statistics for the first timeand then rose
steeply from 1980 to 1995, thereafter levelling off on a high plateau.5
The second approach weighted the countries by population, giving due
importance to China and India. By this measure, global inequality had
been falling since the time series began in 1952: Chinas growth rate
had been negative between 1913 and 1950, while Indias had been barely
zero; but from 1950 to 1973, they were 4.9 and 3.5 per cent respectively.6
However, Milanovics most original contribution was his analysis of the
primary data in the World Banks growing archive of national household
surveys to produce a third measure of global inequality, this time poten-
tially involving all the worlds household units; it was an approach that
didnt assume that every American or Chinese was receiving the aver-
age national income. Instead, the richest Chinese households might be
ranked in the global top 1 per cent, while the income of working-class
Americans would just allow them into the worlds top 20 per cent. This
approach made it possible to grasp inequalities within countries and
inequalities between countries within the same framework.7

Contrasting futures

Milanovics latest book, Global Inequality, now offers a striking set of

theses about the patterning and dynamics of inequality at a planetary
level, with speculations on its future trends and political implications.8
Drawing on his analysis of international household-survey data from
1988 to 2011the era of high globalization, the fall of the Soviet bloc,

5
Branko Milanovic, Worlds Apart: Measuring International and Global Inequality,
Princeton 2005, p. 39.
6
Milanovic, Worlds Apart, p. 86. For Chinese and Indian growth rates, see Angus
Maddison, Contours of the World Economy, 12030 ad, Oxford 2007, p. 380.
7
Needless to say, the methodological problems involved here are gigantic. The
household surveys varied in approachincome measurements predominating in
Europe and the Americas, consumption in Africa and Asiaas well as reliability;
currency equivalents and purchasing-power parity rates are eminently disput-
able; the very rich are likely to be under-represented. Gini coefficients can vary
widely depending on which approach is used: a 2008 Indian survey based on con-
sumption reports a Gini index of 33, while the income-based 2005 India Human
Development Survey found a Gini of 52.
8
Branko Milanovic, Global Inequality: A New Approach for the Age of Globalization,
Cambridge, ma 2016; henceforth, gi. Technical information on the main data pre-
sented in the book is given in Christoph Lakner and Branko Milanovic, Global
Income Distribution: From the Fall of the Berlin Wall to the Great Recession, World
Bank Economic Review, vol. 30, no. 2, 2016.
Figure 1: Relative gain in real per capita income by global income level,
19882008 (2005 international dollars)

100

90
Cumulative gain in real income (%)

80 A
l

70 l
l
C
l
l l
l
60 l l

l
50
l
l
40 l l

30 l l

20
l
l

10
B l
l
0 l

0 10 20 30 40 50 60 70 80 90 100
Ventile/percentile of global income distribution

Source: Milanovic, Global Inequality, p. 11.

the rise of China and the financial crisisMilanovic offers a remarkable

illustration of how the worlds income has been redistributed across
the planet (Figure 1). Relative gains in real per capita income are cal-
culated for each percentile of the global population, from the poorest
to the richest 1 per cent. There are two main winners. The largest,
group A, represents those between the 50th and 60th global percen-
tiles, the emerging middle class of China, India, Thailand, Vietnam and
Indonesia. Their income has increased by 70 per cent or more since the
late 1980sthough as Milanovic notes, because they are still relatively
poor compared with the Western middle classes, one should not assign
to the term the same middle-class status (in terms of income and educa-
tion) that we tend to associate with the middle classes in rich countries.9
The other winners, group C, are the top 1 per cent, whose incomes have
risen by some 65 per cent; half of these are Americansindeed, the
top 12 per cent of Americans are all in the worlds top 1 per centand

9
gi, p. 19.
 6 nlr 103

most of the rest are from Western Europe, Japan and Oceania. The big
losers, group B, are at the 80th percentile of the global population, richer
than the emerging Asian middle class; they are working-class and lower-
middle-class Americans, Europeans and Japanese.

This is the economic basis of the globalist buoyancy in emerging Asia,

the popular resentment in Europe and the us, and the arrogance of
the worlds plutocrats. Qualifying the picture, however, Milanovic also
shows the absolute gains in real per capita income in the same period.
Taking the total increase in world real income as 100, the data show
that 60 per cent of this went to the worlds top 5 per centand again,
working-class households in the advanced-capitalist countries did rela-
tively badly (Figure 2).

Milanovic goes on to explore these dynamics in detail, examining first

the class-based trends of income distribution within nations, then
location-based shiftsthe economic advance or decline of coun-
tries within the international orderbefore fitting these dimensions
together, to sketch out a history of global economic inequality over the
past two hundred years, through to the aftermath of the financial crisis.
Up till the beginning of the nineteenth century, he argues, inequality
in the populous agrarian economies was overwhelmingly structured by
class: the gap between rich and poorthe living standards of subsist-
ence farmers and their landlordsvaried by little more than 20 per
cent from country to country; income levels were effectively stagnant
and changes largely resulted from malign exogenous factors: pes-
tilence, famine, war.10 With the advent of capitalist industrialization
in the nineteenth century, soaring growth rates in Europe and North
America drove up international inequality, as rising mean incomes
in the Atlantic world pulled away from the rest. Inequality within the
first-wave industrial-capitalist countries also rose initially, thanks to
high returns on capital and differential wages. By the mid-twentieth
century, however, class-based inequalities within countries had dropped
to historic lows.

This was only partly due, Milanovic suggests, to the malign factors
stressed by Pikettyand recently, in overdone form, by Walter Scheidels

10
gi, pp. 5965.
Figure 2: Percentage of absolute gain in real per capita income received,
by global income level, 19882008 (2005 international dollars)

30
Top 25%
Absolute global income gain received (%)

25

Top 1%
20

15

10

0
5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 99 100

Ventile/percentile of global income distribution

Source: Milanovic, Global Inequality, p. 25.

The Great Levellerthe destruction of assets in the two world wars.11 More
important for the global fall in class-based inequality was the benign
challenge of politically organized labour. Levels of income inequality
are, almost by definition, the result of social and political struggles,
sometimes violent ones, Milanovic writes; but these struggles take place
within a broader economic environment, with parameters set by the
conditions of global trade, labour supply, capital abundance and exploit-
able resources. In the mid-twentieth century, strong trade unions and
workers parties, as well as the example and military might of the Soviet
Union, helped to constrain the power of capital everywhere; the us itself
pushed for radical land reforms in Cold War frontier states like Japan,
South Korea and Taiwan.12 At the same time, the economic gulf between

11
Contra Piketty, Milanovic cites Hobson, Lenin, Luxemburg and (indirectly) Niall
Ferguson to argue that the conflagration of 1914 was not exogenous but caused by
the pressures of competitive imperial expansion, made necessary by insufficient
demand at home: the forces that set the rich worlds inequality on its downward
path for the next seventy years were contained in the unsustainably high domestic
inequality that existed before: gi, pp. 946.
12
gi, pp. 86, 99.
 8 nlr 103

rich and poor countries was unprecedented in world history. The income
of many workers in the advanced-capitalist countries was higher than
that of middle and even upper-middle classes in Asia and Africa. In
1970, the peak of inequality between nations, us gdp per capita in inter-
national dollars was 20 times the Chinese level.13

The 1980s and 90s brought another double-edged inflection. While

Atlantic economies slowed, Chinese growth rates took off with a
dynamism that the West had never managed and rivalled only by Japan,
South Korea and Taiwan in the preceding decades, leading to an Asia-
driven convergence between national income levels; today, us gdp
per capita in international dollars is barely four times that of China.
At the same time, inequalities within countries began to grow again,
especially in the Westas services replaced manufacturing, median
wages stagnated, while high-end incomes and returns on specula-
tive capital soaredbut also in China and the post-communist world.
Using the latest available data (2011), Global Inequality shows that
these trends continued and accelerated during the financial crisis and
the Atlantic worlds Great Recession, reinforcing the shift of economic
dynamism to Asia.14

Future trends

As for the future of income inequality, Milanovic sees two major tenden-
cies. One is a continuation of location-based global convergence: even
if Chinas growth rate slows to 5 per cent, its per capita gdp will match
the eu average by the 2040s. He admits, however, that convergence is
largely Asia-driven; growth in other regions has been more uneven. From
a low starting point, African gdp per capita in 2013 was only 1.9 times
greater than its 1970 level; Latin America, though richer to start with,
had not grown sufficiently to begin to converge with Europe and North
Americawhereas Asias gdp per capita had nearly quintupled over
the same period (Table 1). Weighted by population, there are still huge
gaps between national average incomes (Figure 3), and some economies
will fall still further behind, including countries with high population
growth. Global equality is not in sight. It remains the case that ones
country of origin has a greater impact on life chances than the class into

13
gi, pp. 1303. 14
gi, p. 30.
Table 1: Growth record of various regions of the world between 1970 and 2013
(2005 international dollars)

Average 1970 Ratio of 2013 to 1970

gdp per capita gdp per capita
Region (population weighted) (across countries)

Africa 2,900 1.9

Asia 2,200 4.9
Latin America 7,000 2.0
Postcommunist 8,300 2.4
transition
countries
Western Europe, 19,700 2.3
North America,
Oceania
World 6,400 2.6

Source: Milanovic, Global Inequality, p. 172.

Figure 3: Distribution of world population by real gdp per capita of the

country in which they live, 2013

30
India,
Indonesia

China
World population (%)

20

10
Brazil,
Mexico most of Western USA
Europe, Japan Germany,
Russia Canada

0 10,000 20,000 30,000 40,000 50,000

gdp per capita (in 2005 international dollars)

Source: Milanovic, Global Inequality, p. 34.

 10 nlr 103

which one is born. Milanovic refers to this as a citizenship premium:

if you are born in the us, you will grow up in an economy with a mean
national income 93 times higher than that of the Democratic Republic
of Congo.15 The rational strategy for workers in this context is migra-
tion, he argues: wages can be doubled or trebled, simply by moving
to a richer country.

The other major tendency, he suggests, is the cyclicality of class-

based inequality within national economies. Late twentieth-century
economic development jumped off the so-called Kuznets Curvethe
conjecture, as its postulator Simon Kuznets modestly called it, that eco-
nomic inequality would first rise with capitalist development and then
decline; a global generalization of Western experience between the mid-
nineteenth and mid-twentieth centuries.16 As Piketty, Saez and many
others have pointed out, inequality has risen steadily in the West since
the 1970s, returning to levels last seen in the Belle poque. But, in hon-
our of the late master, Milanovic proposes instead a cyclical pattern of
rising and falling inequality, which he dubs Kuznets waves, or cycles,
driven by economic and political factors. In his view, the current rise
in Western income inequality can be seen as the upswing of a second
Kuznets wave, mainly driven by technology and the labour-supply shock
that came with the opening of China and the fall of communism, as
well as the disappearance of the political constraint on capital it once
represented. In the prc itself, inequality is still rising in the first phase
of its first Kuznets wave, in which industrialization is combined with the
transition from socialism to capitalism. In China, Milanovic hopes that
a tightening labour market and pressure for wage rises may counterbal-
ance the malign effects of capital concentration and a rigid political
system, leading to a benign, Kuznets-style reduction in inequality. In

15
gi, p. 133.
16
Simon Kuznets (190185): born to a well-off Jewish family in Pinsk, Kuznets
studied at the University of Kharkiv and Kharkiv Institute of Commerce, engaging
with the work of Schumpeter and Kondratieff, before emigrating to the us in 1922,
where he studied with Wesley Clair Mitchell. Joining Mitchell at the nber in the
1930s, he led research into us gnp and helped establish national-income accounts
in allied Cold War countries, from South Korea and Taiwan to Israel. Kuznetss
conjecture on the relationship between economic growth and income inequal-
ity was first presented in his 1955 presidential address to the American Economic
Association. He warned, however, that industrialization in underdeveloped coun-
tries might be even more traumatic and inegalitarian than in the Atlantic world,
due to seemingly more unequal starting points.
 therborn: Inequality 11

the us, however, no such equalization is in sight.17 His final prediction?

The gains from globalization will not be evenly distributed.

Limits to extraction

Milanovic is a highly empirical economistindeed, more of a social

historian and a sociologist than an economic theoristwhose work on
household-survey data offers a genuine advance in our knowledge of
changing global living standards. His most important motive in study-
ing inequality is to see how the world has changed, especially during
the most recent period of 19882011, for which his book is essential
reading. He is also a critic of our times, with a sharp eye for com-
plexities, and a seer into the future whose predictions are couched in
a language of judicious caution. In contrast to the situation in 1917,
he thinks present levels of inequality pose no medium-term threat to
capitalism as such. However, he identifies two dangers for democratic
capitalism: plutocracyhere he draws upon the work of the us political
scientist Larry Bartels, whose Unequal Democracy (2008) detailed the
capture of the American political system by the moneyed classand
nativism. Writing before Trumps victory, Milanovic associates the latter
with Europe, but the new us administration is a striking combination of
plutocracy and nativist reaction.

Global Inequality raises a number of conceptual, analytical, methodologi-

cal, political and social issues; a few of which will be touched upon here.
Conceptually, one very fruitful question that Milanovics work raises is:
what is the maximum sustainable level of inequalityor exploitation?
In theory, this limit might not exist: a sufficiently abundant supply of
unfree labour could make it possible to build the Great Wall of China
or Pyramids of Giza without bothering whether the workers survived,
as long as their ranks could be replenished by slave raids or imports.
Nevertheless, the question posed by Milanovic is very much to the point
for any history of inequalityand in the historical short-run, it may be
more difficult to answer than he has allowed for. In general, we may
state that the richer a society is, the more inequality it can contain; with
so much wealth around, even the poorest can survive on scraps of it. The
wealthiest nations of the modern world could probably still function with
a Gini coefficient very close to the maximumperhaps as high as 99.

17
gi, p. 113.
 12 nlr 103

In an earlier work, Milanovic and his co-authors used the wages of

unskilled labourers as a proxy for minimum subsistence levels to
calculate historical extraction ratios, or what Marxists would call exploi-
tation ratiosthat is: the ratio of the surplus appropriated by the ruling
class to the value of the countrys total product, once the subsistence
requirements of the population have been deducted. In a number of
casesMughal India in 1750, New Spain (Mexico) in 1790, the French
Maghreb in 1870, British Kenya in 1927, British India in 1947this
exploitation ratio by the ruling elite was around 100 per cent of the
maximum sustainable level; the point that colonialism was extremely
lucrative for the metropolitan powers and left few, if any, economic
benefits to the colonized is hammered home emphatically.18 The main
issue here, however, is not the exact measure of extraction in each par-
ticular case, but the light such calculations can shed upon the nature
of contemporary capitalist inequalities. Thus, for example, income
inequality in England in 1688 was roughly on a par with the levels seen
in the us today; in the former case, however, the extraction rate was
more than 60 per cent of the possible maximum, while in the contem-
porary us it is a little over 40 per centa measure of present-day living
standards, even in an era when nearly 15 per cent of Americans are
receiving food stamps.

Catching up

Analytically, as weve seen, Milanovic distinguishes two discrete patterns

of income inequality: Kuznets cycles, at work within national econo-
mies, and an uneven process of catch up, operating between countries.
How useful are these notionsand what is the relationship between
them? As far as Kuznets-derived conjectures are concerned: on the basis
of the historical record, a bet on inequality going up and down would
seem to be a much safer wager than predicting an indefinite tendency

18
Branko Milanovic, The Haves and the Have Nots, New York 2011, p. 199. The
calculus behind these estimates is rather complex, and the extraction ratio actu-
ally refers to the relationship between two Gini coefficients: the estimated one
and the maximum possible level, as defined by subsistence needs, the size of the
economy and the total population. At all stages of the analysis, crucial assump-
tions are made which, while plausible, may not be altogether true. Sometimes the
calculations yielded extraction rates of 200 (Mughal India) or 360 (Congo) per cent
of the maximum possible. The procedure is described in Branko Milanovic, Peter
Lindert and Jeffrey Williamson, Measuring Ancient Inequality, nber Working
Paper no. 13550, October 2007.
 therborn: Inequality 13

in either direction. But it remains a conjecture, the cycles lacking any

proper theoretical substantiation. Is there any discernible logic to them,
beyond the contingent outcomes of class struggles? On the other hand,
the notion of the Kuznets cycle has the merit of spurring the search
for crucial pro-equality variables, whether malignthe two world wars
were decisive in setting equalizing economic tendencies in motion
among the participant powersor benign ones: egalitarian politics,
the spread of education, population aging, technological change favour-
ing the low skilled.

Global Inequality offers no explanation for the varying patterns of inter-

national convergenceEast Asias take-off, Latin Americas secular
stagnation, Africas repeatedly faltering growth. Despite the rise of
China, Milanovic stresses that this is still a Franz Fanon world of radical
inequalities between countries, rather than a Marxian one of widening
gulfs between rich and poor. It is true that Marxs empirical analysis
of capitalism was in some respects overtaken by events: the economic
polarization of labour and capital, under the thumb of the latter, peaked
in Britain and France in the 1860s, around the time of the first vol-
ume of Capital.19 By 1894, when the third volume appeared, inequality
between countries had already surpassed class-based inequality within
countries.20 However, social history is not reducible to economic statis-
tics. Marxs theory of the emancipation of the working class through its
own efforts both predicted and contributed to the rise of labour move-
ments that constrained the exploitative urges of the capitalist system,
culminating in the Western European welfare states. Marxisms revo-
lutionary wing not only made the October Revolution, arousing radical
hopes all around the world, but also gave birth to popular anti-imperialist
uprisings in which class mobilizations were often decisiveand which,
socio-politically if not economically, worked to overcome Milanovics
location-based inequality.

Methodologically, as noted above, the problems involved in any study

of global inequality are huge. There are good reasons to be sceptical
about the reliability and comparability of the household surveys on
which Milanovic has based his work, drawn up according to varying

19
Thomas Piketty, Le Capital au xxi sicle, Paris 2013, p. 317.
20
Jan Luiten van Zanden et al., The Changing Shape of Global Inequality 1820
2000: Exploring a New Dataset, Review of Income and Wealth, vol. 60, no. 2, 2014.
 14 nlr 103

specifications in the different countries. In China, different methodolo-

gies were used for rural and urban household surveys before 2010, and
since the two were brought into line in 2013, no new data has been made
public.21 Although Milanovic and his colleagues make some adjustments
to allow for the likely under-representation of the very rich and for the
impact of differing purchasing-power parity benchmarks, they can-
not entirely compensate for the fact that some surveysespecially in
Europe and the Americasmeasure income, while othersparticularly
in Africa and Asiameasure consumption. In general, consumption
is much more evenly distributed along the social scale than income,
because of saving at the higher end and borrowing at the lower.22 The
mixture of income and consumption surveys thus raises doubts about
the level of global inequality Milanovic reports: a Gini coefficient of 67
for 2011, adjusted to 7376 to take account of the top incomes.23 I remain
sceptical about these heroic attempts to measure world inequality: South
Africa alone harbours six conurbations with Ginis of 7075; its hard to
believe that the planet as a whole will not have a greater span of inequal-
ity than a single city.24

However, the main focus of Milanovics work is not the precise measure-
ment of global inequality, but its patterning, future trends and political
implications. Unlike many economists, he is not afraid to stake out
clear-cut political positions. The policies he considers most plausible to
reduce national income inequality in the twenty-first century draw not
on the European welfare state but on the East Asian capitalist model.
If the second-wave Kuznets curves are going to enter a downswing, he
argues, this is unlikely to be driven by the same forces that lowered
income inequality in the twentieth century, whether benigneducation,
social transfers, nationalizationsor malign: the destruction of wealth
through hyperinflation and wars. Instead, he suggests reducing

21
gi, p. 176.
22
The 2008 consumption-based Indian survey used by Milanovic reported a Gini
of 33, while the 2005 Human Development Survey of India found an income-based
Gini of 52. Compare Lakner and Milanovic, Global Income Distribution, p. 212,
and Reeve Vanneman and Amaresh Dubey, Horizontal and Vertical Inequalities
in India, in Janet Gornick and Markus Jntti, eds, Income Inequality: Economic
Disparities and the Middle Class in Affluent Countries, Stanford 2013, pp. 43958.
23
gi, p. 119; Lakner and Milanovic, Global Income Distribution, p. 217.
24
Compare Sudhir Anand and Paul Segal, What Do We Know about Global Income
Inequality?, Journal of Economic Literature, vol. 46, no. 1, March 2008, p. 62, and
un Habitat, State of the Worlds Cities 2016, Box 4.2.
 therborn: Inequality 15

inequalities in asset-ownership, closer to the levels that prevail in Korea,

Japan or Taiwan. Policies to promote such a shift would include a high
inheritance tax (Pikettys proposal), corporate tax policies favouring
shares for workers, and moves to encourage asset-ownership among the
poor, la Hernando de Soto.25

Secondly, Milanovic argues strongly in favour of greater labour mobil-

ity as a way of equalizing global incomes. Currently there are only 230
million migrants globally, some 3 per cent of the worlds population, but
Global Inequality cites a Gallup survey suggesting that 700 million10
per cent of the worlds populationwould move to another country if
they could. As a global egalitarian, Milanovic is sharply critical of Rawlss
equality in one country, but also of the discriminatory immigration
policies privileging skilled workers that are favoured in Canada, Australia
and the uk; these leave the poor world even poorer, he argues, as its
most educated citizens are encouraged to leave. Milanovic is equally
scathing about those concerned with legal equality for immigrants in
their own country, while indifferent to the plight of workers outside their
bordersor, say, protesting against the inhumane treatment of migrants
in the Gulf States, but largely silent about inhumane treatment in the
countries theyve come from. Despite their harsh working conditions,
which Milanovic deplores, Gulf wages nonetheless represent a bonus for
their families, he arguesand a reduction of global inequality. As a first
step towards removing rich-world barriers to migration and reducing
the resentment of recipient populations, he recommends a kinder ver-
sion of the Gulf model, with a compromise on de jure equalitygiving
migrant workers only limited rights and benefits, but allowing more of
them to enter.26

Multidimensionality dismissed

A major limitation of Milanovics rich work is his conventional con-

centration on economic inequality only. Reducing social inequalities to
income alonethe size of peoples walletsis a very myopic approach.
One reason why, for all the talk about inequality in the wake of the 2008
financial crisis, there has been limited public outrage and no sustained
political effort to attack it is, I suspect, the exclusive focus on income

25
gi, pp. 21771.
26
gi, pp. 14774.
 16 nlr 103

and wealth in mainstream debate. The rich evoke a number of differ-

ent emotions and reactions: not only a sense of injustice, but also of
resentment, fascination, envy and admiration, as idols of luxury, glam-
our and success. Inequality should be grasped not just as an abstract
number but as embedded experience, involving bodily well-being (vital
equality) and personal autonomy (existential equality, particularly in
regard to ethno-racist and family-gender structures) as well as economic
resources. Public discourse, even on the left, has so far been unable to
combine these dimensions. For example, apart from a few academic
specialistsoften too specialized themselves to think of the wider
implicationshardly anyone has noticed that the restoration of capital-
ism in the former Soviet Union took more lives than the Iraq and Syrian
wars put together: 1.9 million excess deaths in Russia alone in 199095;
around 4 million for the ussr in the 1990s.27 While poor ex-Soviet
citizens were dying en masse, life-expectancy rates among university-
educated Russians began to rise.28

Inequality of life expectancy is growing in most rich countries. So far

this trend has mostly been driven by affluent people living longer, while
the life curves of the disadvantaged stagnate. But in the us, the absolute
life expectancy for white men and women with at most a high-school
education is growing shorter; for white women it has fallen by five
years since 1990. In 2015, average life expectancy in the us came to
a halt.29 Recent research in the fields of epigenetics and child develop-
ment has provided evidence of how human life-curves are significantly
determined before children reach school age, by foetal and post-natal
social environments. It is becoming increasingly clear that humans
are born unequal, and that overall inequality is accelerating over their

27
Vladimir Shkolnikov and Giovanni Andrea Cornia, Population Crisis and Rising
Mortality in Transitional Russia, in Cornia and Renato Panicci, eds, The Mortality
Crisis in Transitional Economies, Oxford 2000, p. 256; Michael Marmot, The Status
Syndrome: How Social Standing Affects our Health and Longevity, New York 2004,
p. 196. The figures refer to the number of excess deaths in comparison with previ-
ous years, after subtracting the purely demographic effects of ageing.
28
Michael Murphy et al., The Widening Gap in Mortality by Educational Level in
the Russian Federation, 19802001, American Journal of Public Health, vol. 96,
no. 7, July 2006.
29
Stuart Jay Olshansky et al., Difference in Life Expectancy Due to Race and
Educational Differences Are Widening, and Many May Not Catch Up, Health
Affairs, vol. 31, no. 8, 2012; 2015 life expectancy figures from the National Centre
for Health Statistics.
 therborn: Inequality 17

life-courses.30 Interestingly, these insights from cutting-edge genetics,

developmental psychology and sociology are now entering a small cor-
ner of the proud and usually self-sufficient field of economics. A key
figure in this respect has been the Chicago economist James Heckman,
a Nobel laureate for his technical work on the micro-econometrics of
diversity and heterogeneity.31

Existential inequality has taken some major hits since the 1970s, as
legally institutionalized racism finally fell, from the American South to
apartheid South Africa and White Australia, while legally institutional-
ized patriarchy was also dismantled in many states. But its become clear
that existential inequality can be successfully privatized, deregulated,
left to the initiatives of anti-egalitarian individuals and groups. This has
been dramatically highlighted by the shootings of American blacks by us
police. As Ta-Nehisi Coates has written: Racism is a visceral experience.
It dislodges brains, blocks airways, rips muscle, extracts organs, cracks
bones, breaks teeth.32 As an economist, Milanovic is in plentiful com-
pany in neglecting life-course and existential issues. In a sense he is the
heir of those Marxists who, as Sartre wrote in 1960, are only concerned
about adults: reading them one would think that we are born at the age
when we receive our first wage.33 And for all his respect for Fanon, he
seems to be tone-deaf to existential issues like racism. Fanons Peau
Noire, Masques Blancs opened with a quotation from the Discourse on
Colonialism by his fellow Martiniquais, Aim Csaire, a powerful depic-
tion of racial inequality: I am talking of millions of men who have been
skilfully injected with fear, inferiority complexes, trepidation, servility,
despair, abasement.

In a concluding section of Global Inequality, Milanovic raises the question

of why the Atlantic world has been so much more successful in curtail-
ing legal inequalitiesbetween men and women, whites and blacks,

30
See Therborn, Life-Curves of Inequality, Korean Journal of Sociology, vol. 49,
no. 6, 2015.
31
For a sample of this work, see Flavio Cunha and James Heckman, The Economics
and Psychology of Inequality and Human Development, Journal of the European
Economic Association, vol. 7, no. 23, AprilMay 2009; and James Heckman and
Stefano Mosso, The Economics of Human Development and Social Mobility,
Annual Review of Economics, vol. 6, 2014.
32
Ta-Nehisi Coates, Between the World and Me, New York 2015, p. 10.
33
Jean-Paul Sartre, Critique de la raison dialectique, Paris 1960, p. 47.
 18 nlr 103

hetero- and homosexualsthan in reducing income inequality. But

instead of answering it, he moves on to another issue: why it is wrong to
focus exclusively on horizontal inequalityitself a strange term to use
for racism or patriarchy, whose very essence is a vertically constituted
relation of superiority-inferiority. The arguments he presents for putting
existential inequality aside are familiar enough to feminists and dis-
criminated minorities: an emphasis on group politics is divisive; it does
not address the economic basis of sexist or racist exploitation; and it is
escapist, leaving the system of capitalist class privilege untouched, rather
than focusing on meaningful change. The larger and more difficult
questionshow the different forms of inequality interact with or over-
determine each other; whether or how they divergego unaddressed.

Elsewhere, Ive argued that while the three dimensions of inequality

combine and interact, they are not analytically reducible to each other;
each has its own dynamic and they dont always co-vary. In the mod-
ern era, advances in vital, existential and resource inequality have been
uneven and non-linear. On the first, global inequalities in life expectancy
and infant mortality widened from 1800 to 1950, as living standards in
the West pulled away from the rest; the decades from 1950 to 1990 saw
a convergence, with decolonization, vaccination and the eradication of
malaria. But the aids epidemic in Africa and rising mortality in the for-
mer ussr widened the gap, now narrowing again. Strikingly, measures
of vital inequality have been worsening in the advanced-capitalist coun-
tries, too, as life expectancy expands enormously for the rich, improves
slowly for the working class and declines for the poorest. Global ethno-
racial inequality may have reached a peak around 1900, in the era of
high colonialism and Jim Crow, but the worst genocides took place in
194245 and 199495. Advances in existential equality have depended
on the strength and struggles of the disadvantaged themselves: decolo-
nization, civil rights, the end of apartheid are on one side of the ledger,
anti-immigrant sentiment and Islamophobia on the other. Women
have gained significant autonomy in most oecd countries and, to a
certain extent, Latin America; but patriarchal authority remains strong
in much of Africa, South Asia, the Chinese hinterland and the Middle
East.34 These inequalities intertwine with the income patterns traced by
Milanovic, which sometimes reinforce, sometimes diverge from them.

34
See The Killing Fields of Inequality, Cambridge 2013.
 therborn: Inequality 19

We can distinguish four separate mechanisms at work in the social

reproduction of inequalities: distanciation (that is, capitalizing on given
advantages), direct exploitation, institutional hierarchization and exclu-
sion. These suggest a broader palette of countervailing strategies in
fighting for equality than those Milanovic has in mind. Against distanci-
ation: affirmative action, positive discrimination, compensation. Against
exploitation: redistribution, nationalization, expropriation. Against hier-
archization: democratization or dismantling, through the countervailing
power of subordinates. Against exclusion: inclusion, anti-discrimination
laws, migration.35 Branko Milanovic has established himself as our best
guide to the fractured landscape of global economic inequality. But Sartre
was right: the human conditionand the crimes against itcannot be
reduced to the pay-cheques received by adults.

35
Therborn, Killing Fields of Inequality, pp. 5467.