April 26, 2007

The rich are getting richer?

The "trends in top incomes does not suggest that there has been a sustained long-term increase in income inequality in Indonesia", Andrew Leigh and Pierre van der Eng conclude in a recent working paper.

In short, as Indonesia's economy grows, the rich do get richer. But so do the poor.

Income Share of the Top 10% in Indonesia (Figure 2 in the paper)

Hence, in the last two decades, the income share of the 10 percent richest remains pretty much the same, in the 35%-40% range.

2 comments:

johnorford said...

indonesia doesn't have that bad inequality actually. (-- if u think inequality is bad that is).

prob cos all the rich ran off to sg ;).

Anonymous said...

Gini ratio 0.4 - 0.5 is pretty high, isn't it?
I mean, inequality doesn't increase but it remains high.