You know the catechism: The rich are getting richer, the poor are getting poorer, and globalization is exacerbating inequality at an unprecedented rate. The message is hard to avoid. Representative of the conventional wisdom is the claim, in a background paper for the United Nations' 1999 Human Development report, that "the gap between the rich and poor countries and between rich and poor people continues to widen."
But the conventional wisdom is dead wrong, according to former World Bank economist Surjit S. Bhalla. In his recent book Imagine There's No Country (Institute for International Economics), Bhalla calculated the world distribution of income at 20-year intervals during the last half-century, adjusting for purchasing power. He found that the world as a whole was getting richer and that the poor were doing it faster than the wealthy. Bhalla's figures demonstrate that during the era of globalization, the world has become not merely more prosperous but also dramatically more egalitarian. Now what are we supposed to protest?
CHART: World Income Distribution, 1960, 1980, and 2000