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Who is the richest person in the world, ever? Does where you were born affect how much money you’ll earn over a lifetime? How would we know? Why—beyond the idle curiosity—do these questions even matter? In The Haves and the Have-Nots, Branko Milanovic, one of the world’s leading experts on wealth, poverty, and the gap that separates them, explains these and other mysteries Who is the richest person in the world, ever? Does where you were born affect how much money you’ll earn over a lifetime? How would we know? Why—beyond the idle curiosity—do these questions even matter? In The Haves and the Have-Nots, Branko Milanovic, one of the world’s leading experts on wealth, poverty, and the gap that separates them, explains these and other mysteries of how wealth is unevenly spread throughout our world, now and through time.   Milanovic uses history, literature and stories straight out of today’s newspapers, to discuss one of the major divisions in our social lives: between the haves and the have-nots. He reveals just how rich Elizabeth Bennet’s suitor Mr. Darcy really was; how much Anna Karenina gained by falling in love; how wealthy ancient Romans compare to today’s super-rich; where in Kenyan income distribution was Obama’s grandfather; how we should think about Marxism in a modern world; and how location where one is born determines his wealth. He goes beyond mere entertainment to explain why inequality matters, how it damages our economics prospects, and how it can threaten the foundations of the social order that we take for granted.   Bold, engaging, and illuminating, The Haves and the Have-Nots teaches us not only how to think about inequality, but why we should.


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Who is the richest person in the world, ever? Does where you were born affect how much money you’ll earn over a lifetime? How would we know? Why—beyond the idle curiosity—do these questions even matter? In The Haves and the Have-Nots, Branko Milanovic, one of the world’s leading experts on wealth, poverty, and the gap that separates them, explains these and other mysteries Who is the richest person in the world, ever? Does where you were born affect how much money you’ll earn over a lifetime? How would we know? Why—beyond the idle curiosity—do these questions even matter? In The Haves and the Have-Nots, Branko Milanovic, one of the world’s leading experts on wealth, poverty, and the gap that separates them, explains these and other mysteries of how wealth is unevenly spread throughout our world, now and through time.   Milanovic uses history, literature and stories straight out of today’s newspapers, to discuss one of the major divisions in our social lives: between the haves and the have-nots. He reveals just how rich Elizabeth Bennet’s suitor Mr. Darcy really was; how much Anna Karenina gained by falling in love; how wealthy ancient Romans compare to today’s super-rich; where in Kenyan income distribution was Obama’s grandfather; how we should think about Marxism in a modern world; and how location where one is born determines his wealth. He goes beyond mere entertainment to explain why inequality matters, how it damages our economics prospects, and how it can threaten the foundations of the social order that we take for granted.   Bold, engaging, and illuminating, The Haves and the Have-Nots teaches us not only how to think about inequality, but why we should.

30 review for The Haves and the Have-Nots: A Brief and Idiosyncratic History of Global Inequality

  1. 4 out of 5

    Bryan Alexander

    This is a major work in current events, forecasting, and economics. It offers powerful ideas for understanding the present, recent history, and the medium term future. I fear people won't read it. That's because Global Inequality: A New Approach for the Age of Globalization attempts a tricky thing. First, it looks hard at economic inequality, which is a subject that already appalls most people, or just skates over their heads. Second, it places the subject on an international level. This means th This is a major work in current events, forecasting, and economics. It offers powerful ideas for understanding the present, recent history, and the medium term future. I fear people won't read it. That's because Global Inequality: A New Approach for the Age of Globalization attempts a tricky thing. First, it looks hard at economic inequality, which is a subject that already appalls most people, or just skates over their heads. Second, it places the subject on an international level. This means that many people who see a world limited by their nation's borders for whatever reason - nationalism, xenophobia, education, lack of time - will stop paying attention. Third: it's macroeconomics, usually guaranteed to miss most people's attention. That's a shame, because the findings are very, very important. Branko Milanović is famous among some policymakers for identifying a crucial fact: that while incomes rose in many nations over the past generation (from 1988: 3), they did so unevenly. Poor and middle class people experienced serious income growth in the developing world, starting to catch up with the rest (economic convergence), while those in some advanced nations (including the US) saw their incomes stagnate. Meanwhile, the richest everywhere got richer. This appears very clearly in what has been nicknamed "the elephant graph": (source) To be too reductive, Milanović derived these findings from using several rich datasets from multiple nations, than analyzing them in comparison. What can we learn from this data? It helps explain populism and panic in certain advanced nations - i.e., Trump, Brexit, the Euro right's resurgence. If you're watching the rich get richer while you go nowhere, you won't be happy about those in charge, to be blunt. "People... belong[ing] to the lower halves of their countries' income distributions... are certainly not the winners of globalization." (20) And it might feed xenophobia, if people link their stagnant or declining condition to people doing better elsewhere. China's extraordinary post-Mao economic boom played a huge role in this transformation. So did globalization (although Milanović takes care to distinguish between the free flow of capital across borders, versus labor). There's also a bit of macroeconomic argument over the Kuznets cycle. This is a famous idea, stating that economic growth tends to grow income inequality, but then the gaps start to fade. Apparently this model has been controversial for decades. Milanović argues that the cycle is broken now - or rather that there's a new model, where development (income growth) now means steady inequality rising in the post-industrial era (4). As examples of this Milanović dwells on arguably the two biggest and most influential nations, China and the United States, and offers a sobering analysis of why income inequality is likely to keep growing in both. (176ff) In China, urban concentration of wealth is widening a gap with the countryside, and a centralized authority structure might not decide to act against inequality for reasons of self-interest. For the United Staters, reasons include: substituting capital for labor (i.e., automation); concentrating wealth with education; assortative mating; the fierce political power of the economic elite. Corruption plays a role in both, albeit in different forms. The author also does a great job of distinguishing between economic inequality within nations (rich versus poor in Italy), economic inequality between nations (average income in Kazakhstan versus Brazil), and comparing economic strata across nations (118ff). I've rarely seen anyone do this. Among other things, this leads Milanović to see Frantz Fanon's model of a world separated by colonial and colonized nations are a better guide to present day global inequality than Marx's description (128-9), while suggesting class will overwhelm geography in this sense in the future, as inequality between nations (weighted for populations!) seems to be declining (131, 166). As a futurist I found much to appreciate in Global Inequality, starting with his bracing review of economic forecasting in the mid- and late 20th century. Based on a range of books, Milanović argues that futurists all too often fall into certain errors: overstating present-day factors; failing to account for dramatic changes, up to black swans; paying too much attention to certain actors, while failing to account for others - China is a great example of the latter, largely missing from these forecasts (155ff). After a great deal of hedging, the author offers up some tentative forecasts. Perhaps the darkest is this:[S]ocial separatism [or c]lass bifurcation has many implications: politically, the middle class becomes increasingly irrelevant; production shifts toward luxuries, and social expenditures change from being directed toward education and infrastructure to policing. (198-9) While the political system remains democratic in form because the freedom of speech and the right of association have been preserved and elections are free, the system is increasingly coming to resemble a plutocracy. (199)Moreover, accidents of birth are starting to eclipse the American Dream's potential for economic mobility (216). There's also an interesting note about different attitudes towards economic growth in developed and developing nations. A rising argument in the former holds that we should consider restraining GDP growth, as it contributes to carbon emissions. However, as the author points out, without growth the latter nations won't catch up with the former. This implies a very interesting global tension to anticipate. (233) The book offers some policy solutions, but, as with Thomas Piketty's great work, isn't happy about their prospects. Intriguingly, Milanović is less interested in states redistributing wealth through income taxes than in having them address "endowments" - i.e., taxing personal fortunes through inheritance and getting companies to give more shares to workers (221; this comes close to advocating for worker-owned and -run enterprises). In a breathtaking challenge to American education, the author calls for equalizing educational access, including mak[ing] access to the best schools more or less equal regardless of parental income and, more importantly, to equalize the quality of education across schools. (222) I was surprised by a few items missing from Global Inequality. There isn't a discussion of financialization, which has played an enormous role in the American economy. That sector grew enormously over the past generation and now has not only great wealth but vast political clout... and it's a key factor in generating inequality. I was also surprised that the book relies heavily on the Gini method of measuring inequality, as Piketty - cited many times here - took great care to slam it as a poor measurement. Then again, this is a very short book, just around 240 pages, and very accessible. It's a good sign when you leave a book wanting it to say more. Strongly recommended.

  2. 5 out of 5

    Mehrsa

    This is an excellent perspective on worldwide inequality. Countries are no longer moving together, but rather the super rich are pulling away from the world's poor and this trend is only intensifying. The American middle class is falling as the world's middle class increases. I need to read Milanovic's new book to hear the update. This is an excellent perspective on worldwide inequality. Countries are no longer moving together, but rather the super rich are pulling away from the world's poor and this trend is only intensifying. The American middle class is falling as the world's middle class increases. I need to read Milanovic's new book to hear the update.

  3. 5 out of 5

    Wilte

    Nice economics book with and on the famous elephant graph showing global income growth 1988-2008: The great winners have been the Asian poor and middle classes; the great losers the lower middle class of the rich world" (p20) (...) They [globally very rich] too are the winners of globalization, we call them the "global plutocrats". (p22) (...) 44 percent of the absolute gain has gone into the hands of the richest 5 percent of people globally, with almost one-fifth on the total increment received b Nice economics book with and on the famous elephant graph showing global income growth 1988-2008: The great winners have been the Asian poor and middle classes; the great losers the lower middle class of the rich world" (p20) (...) They [globally very rich] too are the winners of globalization, we call them the "global plutocrats". (p22) (...) 44 percent of the absolute gain has gone into the hands of the richest 5 percent of people globally, with almost one-fifth on the total increment received by the top 1 percent (p24) "Wealth inequality is greater than inequality of income or consumption in almost every country" (p39) The global top 1 percent has 29% of income share, but 46% of wealth share. Piketty is mentioned a few times in this book. Very good about this book is that it has a very data/evidence-based approach to globalization and its effects. And Milanovic is honest about the consequences: "The reader needs to be constantly aware that globalization is a force both for good and bad" (p30). He ends the book (p239): Will inequality Disappear as Globalization Continues? No. The gains from globalization will not be evenly distributed. And some interesting historic facts on inequality: based on data from Spain from 1280-1850 there is no relationship between mean income (GDP) and income equality. "over the long term, growth does not require rising inequality" (p89). At the end of the Roman Empire (700 AD), Gini was ~15; incomes were so low, there was no "space" for inequality, there was a common state of poverty. That is also why wars will create equality. "the Industrial Revolution was similar to a big bang that launched part of mankind onto the path of higher incomes and sustained growth, while the majority stayed where they were, and some even went down. This divergence of paths widened global inequality." (p120). "in 1820 only 20 percent of global inequality was due to differnce among countries. Most of global inquality (80 percent) resulted from differences within countries; that is, the fact that there were rich and poor people in England, China, Russia, and so on. It was class that mattered. (...) By the mid-twentieth century, 80 percent of global inequality depended on where one was born (or lived, in the case of migration), and only 20 percent on one's social class. (p128) The Citizenship Premium: "Just by being born in the United States rather than in Congo, a person would multiply her income by 93 times" (p133) decision (based on economic criteria alone) about where to migrate will also be influenced by the expectation regarding where he may end up in the recipient country's income distribution, and thus about how unequal the recipient's country's distribution is. Suppose that Sweden and the US have the same mean income. If a potential migrant expects to end up in the bottom part of the country's distribution, then he should migrate to Sweden rather that the US: poor people in Sweden are better of compared to the mean than they are in the US, and the citizenship premium, evaluated in the lower parts of the distribution, is greater. The opposite conclusion follow if he expects to end up in the upper part of the recipient country's distribution: he should then migrate to the US. This last result has unpleasant implications for rich countries that are more egalitarian: they will tend to attract lower-skilled migrants who generally expect to end up in the bottom parts of the recipient countries' income distributions. (p135) New capitalism: "capitalism has moved from being a system with complete separation between capital and labor incomes to a variant where the correlation between the two was negative (those who had labor incomes had very little capital income) to the "new capitalism," where this correlation is positive" (p186). The rich have influence Larry Bartels finds that US senators are five to six times more likely to respond to the interests of the rich than to the interests of the middle class. Moreover, Bartels concludes, "there is no discernible evidence that the views of low-income constituents have any effect on their senators' voting"behavior." (p194) Tax less effective in lowering inequality Globalization makes increased taxation of the most significant contributor of inequality -namely, capital income- very difficult (p217) Migration have an economic net-positive effect International Migration Outlook 2013 (OECD), the most comprehensive study of the costs and benefits of migration in Europe, finds that, on average, an immigrant household contributed €2,000 more in taxes than it received in benefits" (footnote 41, p206)

  4. 5 out of 5

    Daniel

    A great book about global inequality. Unlike Piketty's Capitalism in the 21st Century, this book explains more about global than national inequality. Take home point: most of the global inequality is based on the difference between the countries (80%), and not which is inside the countries. As long as this inequality is not tackled, we will continue to see waves after waves of migrant crises in Europe, and both legal and illegal immigration to the rich world. A great book about global inequality. Unlike Piketty's Capitalism in the 21st Century, this book explains more about global than national inequality. Take home point: most of the global inequality is based on the difference between the countries (80%), and not which is inside the countries. As long as this inequality is not tackled, we will continue to see waves after waves of migrant crises in Europe, and both legal and illegal immigration to the rich world.

  5. 4 out of 5

    Jason Furman

    This is one of the most delightful short economics books I have read--and certainly the most delightful on the topic of inequality. The book covers three types of inequality: inequality of people within a country (e.g., Brazil is more unequal than Japan); inequality between countries (e.g., Asia is more unequal than Latin America, because countries in Asia range from very rich to very poor); and inequality of people across countries (e.g., Asia and Latin America are about as unequal, because of This is one of the most delightful short economics books I have read--and certainly the most delightful on the topic of inequality. The book covers three types of inequality: inequality of people within a country (e.g., Brazil is more unequal than Japan); inequality between countries (e.g., Asia is more unequal than Latin America, because countries in Asia range from very rich to very poor); and inequality of people across countries (e.g., Asia and Latin America are about as unequal, because of the combination of the two previous points). This last concept is the one that Branko Milanović pioneered and it provides a fascinating window into inequality, including the observation that inequality of people across the USA and EU are roughly the same (because the EU has more equality within countries but lots of income differences between those countries). The book is organized in three chapters that each explain one of the inequality concepts followed by about 10 vignettes per chapter. The vignettes are delightful and range from questions like why Elizabeth Bennett got married in Pride and Prejudice and who was the world's richest man to more serious topics like the role that inequality across regions played in the dissolution of the Soviet Union and Yugoslavia. Very highly recommended.

  6. 5 out of 5

    Michelle

    Boring, rambling, and without much of a point. To me, the following snippet neatly encapsulates the kinds of truisms you will get from reading this book: "Even if we agree on the role that globalization plays with respect to each channel whereby it affects global inequality, the contextual, historical shapes of things (where in the income distribution of nations the populous countries are) will determine the ultimate answer. There cannot be a general answer to the question "How does globalization Boring, rambling, and without much of a point. To me, the following snippet neatly encapsulates the kinds of truisms you will get from reading this book: "Even if we agree on the role that globalization plays with respect to each channel whereby it affects global inequality, the contextual, historical shapes of things (where in the income distribution of nations the populous countries are) will determine the ultimate answer. There cannot be a general answer to the question "How does globalization affect global inequality?"; there can at best be only contextual answers" (p 156). Wow, how fascinating. Two hundred fifteen pages to tell me there are no easy answers? In addition, the whole book is spent detailing the differing income distributions among individuals and among countries--but not looking at actual quality of life. He makes some adjustments for purchasing power by country but does not consider rising luxury in any detail. He briefly mentions the middle class but gives little analysis of it. To be fair, I learned a little about measures of inequality and how in-country inequality as well as global inequality have risen sharply at different periods to very high levels today. What I didn't learn was the significance of this, or what this inequality means to quality of life, or what to do about it. The best chapter is Income Inequality and the Global Financial Crisis, which actually does give some opinions and analysis. Also, unforgivable mutilation and misuse of a quotation: "To paraphrase Mark Twain, the reports about the rise of the global median, and even more so the global middle, class, have been greatly exaggerated" (p. 172). This is in no way paraphrasing Mark Twain. This is taking six words from a famous statement Mark Twain made about false rumors of his death, inserting them into a bland statement you want to make, and using it in a context that has absolutely no relevance to the original quip.

  7. 5 out of 5

    Daniel

    Milanovic is the expert on global inequality. In this book he explains the effects of globalisation on global inequality. As most people know, the answer lies in the Elephant curve. So the poor people and middle class of the developing world has seen their wages went up, together with the global 1%. Unfortunately, the middle class in the rich world has seen not much growth at all. In absolute terms, however, the gains in the middle were very small compared to the outsized gain of the 1%! Despite Milanovic is the expert on global inequality. In this book he explains the effects of globalisation on global inequality. As most people know, the answer lies in the Elephant curve. So the poor people and middle class of the developing world has seen their wages went up, together with the global 1%. Unfortunately, the middle class in the rich world has seen not much growth at all. In absolute terms, however, the gains in the middle were very small compared to the outsized gain of the 1%! Despite all the economic growth, however, global inequality between countries had not really budged, unless population weighted inequality is taken into consideration, because most of the growth had come from Asia, eapecialy China. Milanovic proposed the Kusnets Wave. The original Kusnets curve proposed by Kusnets in the 1950-60s showed that at least for the rich world, inequality increased and then decreased as workers get rich and demand more rights politically. However, he did not foresee that inequality in the rich world would increase again. The Kusnets Wave hypothesis states that inequality will rise again, as automation, globalisation and free market ideology work together. He agrees with Piketty that technology allows for the substitution of capital (and machines) for labor, and he does not see the new upward movement of inequality to abate any time soon in the rich world, as even the Nordic countries are having rising inequality. For the developing countries, as they get richer, inequality rises dramatically, and then it might drop like what happened in the rich world 50 years ago. Or they might not! Sobering for people in the rich world. Milanovic expects even more anger, nationalism and anti-globalisation in future as the stagnant middle class in the rich world shows their displeasure.

  8. 5 out of 5

    Ob-jonny

    This is a great analysis of income inequality and how it helps or hurts an economy. Judging from historical examples, there is a certain level of inequality that is ideal for maximizing work incentives and maximize the size of the middle class. This balance has been optimized in places like Norway while the high levels of inequality in the US are depressing its economy. The book describes how income inequality has changed over time and about how it as increased over the last 150 years in violati This is a great analysis of income inequality and how it helps or hurts an economy. Judging from historical examples, there is a certain level of inequality that is ideal for maximizing work incentives and maximize the size of the middle class. This balance has been optimized in places like Norway while the high levels of inequality in the US are depressing its economy. The book describes how income inequality has changed over time and about how it as increased over the last 150 years in violation with the standard Kuznets model. There are two models of inequality. The Kuznets model says that there is an inverted U which describes income inequality vs. the level of modernization for an economy. When we were hunter/gatherers, everybody was equal. The formation of city states, empires, and the industrial revolution increased inequality. And then modern societies decreased inequality through progressive economic programs. The Pareto model says that there is always an aristocracy and it just changes names. The monarchs were replaced by corrupt governments and dictators which were replaced by a plutocracy of bankers and CEOs. The reality is a mix between the two because inequality has been increasing rapidly over the last 40 years. The richest countries are 100 times richer than the poorest now while in 1850 the ratio was 6 to 1. This is a fascinating book.

  9. 5 out of 5

    Jason Furman

    An erudite and wide ranging summary of the past, present and future of inequality--including inequality across all people in the world and over long periods of time within countries and between countries.

  10. 4 out of 5

    Laurent Franckx

    A few years ago, Thomas Piketty brought the study of economic inequality back to the limelight with his acclaimed "Capital in the 21th century". While Piketty's book looked only at inequality at the national level, Branko Milanović goes one step further. Building on detailed data at the household level collected over the last decades, Milanović studies global inequality between individuals (as opposed to global inequality between nations). This book is a non-technical summary of his key findings A few years ago, Thomas Piketty brought the study of economic inequality back to the limelight with his acclaimed "Capital in the 21th century". While Piketty's book looked only at inequality at the national level, Branko Milanović goes one step further. Building on detailed data at the household level collected over the last decades, Milanović studies global inequality between individuals (as opposed to global inequality between nations). This book is a non-technical summary of his key findings, followed by a series of policy considerations. The most famous result of the book has started living a live of its own: Milanović's elephant. https://www.economist.com/finance-and... Essentially, this is the graphical representation of the observations that the big winners of the two last decades are the new middle classes in countries such as China (the rump of the elephant) and the top 1%-ers (the upper part of the elephants' trunk). Those who are left behind are those at the absolute bottom of the world's income distribution and the lower middle class in the richer countries (who are of course still in the top deciles at the world level - the point is not that they have become much poorer, but that they are no longer part of the winners). Although Milanović's book has preceded the big populist revolts of the last two years, he was prescient enough to anticipate them as part of the backlash against globalisation. As I am a regular reader of Milanović's blog (and occasionally of his tweets), I cannot say I have learned much from the book. However, this should not discourage anyone from reading a highly accessible and lively book on a highly topical subject. Maybe two comments though (I do not dare call them 'criticisms' as I know that addressing them would be extremely demanding in terms of data collection). A first point is that Milanović addresses mainly inequality of income. (There is also some discussion of inequality of wealth) However, one could argue that what really counts is inequality in consumption. If the 'typical' goods consumed by the poor or the lower middle classes are different from those consumed by the rich or the upper middle classes, then maybe the conventional indexes of consumer prices (which are essential for tracing evolutions over time) are not representative. Recent research in the US has shown that this is not a purely theoretical matter, and actually affects key conclusions on the evolution of median incomes https://www.economist.com/finance-and... (A more technical discussion of consumption inequality is https://www.aeaweb.org/articles?id=10...). A second point (which is not unrelated to the previous) is that income redistribution does not only take place through explicit taxes and transfers, but also through goods that are made available to the public at a reduced price (or even free of charge): subsidised schools, cultural goods and sports; road infrastructure and subsidised public transport; parks and recreational areas, etc. Clearly, this also has effects, but which are much more difficult to measure. It would be interesting to learn how these have evolved over time and affected inequality.

  11. 4 out of 5

    John Hively

    This is an interesting book in which the author makes some good points. However, some of the stuff he writes is completely retarded. He doesn't understand a lot of what is going on. He assumes, for example, if you allow immigrants to flood the job markets of rich countries this will help to end income and wealth inequality because these new migrants will bring their wages up in doing so. That, no doubt, is true. However, what Milanovic doesn't understand is that this will make stagnate or drive This is an interesting book in which the author makes some good points. However, some of the stuff he writes is completely retarded. He doesn't understand a lot of what is going on. He assumes, for example, if you allow immigrants to flood the job markets of rich countries this will help to end income and wealth inequality because these new migrants will bring their wages up in doing so. That, no doubt, is true. However, what Milanovic doesn't understand is that this will make stagnate or drive the wages of the 99 percent down in the rich nations of the world, thereby exacerbating income and wealth inequality in the rich nations. Milanovic also doesn't comprehend that a mild rise of a Chinese middle class is largely because of the tens of millions of US jobs that used to support middle wage lifestyles in the US and other developed nations have been exported to China. Exporting jobs has been one of the primary ways the rich of the USA have created massive income and wealth inequality in the United States. On this issue, the author appears to be completely clueless. Milanovic appears to be totally ignorant about how Chinese currency manipulation plays a significant role in exacerbating income and wealth inequality throughout the world. Milanovic, for example, doesn't seem to comprehend such issues as; jobs in the maquiladora district of Mexico have been exported by the hundreds of thousands to China, Vietnam, and Pakistan. This, of course, has increased income and wealth inequality, an issue which the author appears to be clueless. Are we to believe that Mexican workers will follow their former jobs to China, Vietnam, and Pakistan so that they can work for less than they had been? Globalization is the primary cause of income and wealth inequality throughout the world, and that is what this policy has been constructed to do. We're supposed to believe that more globalization is the remedy for this. On this point, Milanovic is completely idiotic. These are just a few of the reasons why Milanovic's book is largely based on absurdities.

  12. 4 out of 5

    Alexandre

    Just a few months ago, I read “The Great Leveler”, by Walter Scheidel, published in 2017. “The Haves and the Have-Nots” was published seven years before. Both deal with inequality through time and space. While the first fell short of my expectations as a consequence of too many reiterations of the same and, in the end, faulty argument, the last one succeeds in combining conciseness with a broad and nuanced view of the same topic. Milanović writes with easy about a very complex subject, clarifying Just a few months ago, I read “The Great Leveler”, by Walter Scheidel, published in 2017. “The Haves and the Have-Nots” was published seven years before. Both deal with inequality through time and space. While the first fell short of my expectations as a consequence of too many reiterations of the same and, in the end, faulty argument, the last one succeeds in combining conciseness with a broad and nuanced view of the same topic. Milanović writes with easy about a very complex subject, clarifying important concepts and presenting several relevant illustrations of his main arguments. Moreover, he is not shy of confronting a few sacred cows, like criticizing Piketty’s reliance on taxable income, arguing that disposable incomes are better suited to measure inequality. Besides, as he also stresses, data based on income will show greater inequality than one based on consumption. A distinctive aspect of this book is its emphasis on the dual nature of inequality. There are both a “good” and a “bad” one. The first is needed to incentivize people toward studying, hardworking and/or starting risky projects. The last provides the means to preserve acquired positions. Whether the societal outcome of inequality will be, on average, beneficial or harmful will depend on the balance between these two tendencies. As an example on how the lack of proper incentives harms economic development, the author reminds that, under socialism, the income of households can be predicted from their demographic characteristics alone. In other words, individual education, effort and skill are immaterial. Therefore, socialist leveling takes away all, or almost all, incentive to work harder, to learn more. Paradoxically, the socialist regimes are far from free of inequality. It just changes its nature, becoming political. Benefits start being linked to particular jobs (“ex officio” benefits). Those at the top of the political hierarchy have access to goods in short supply. The pernicious consequences of such centralization of the access to privileges could not be overstated. In the end, [p]ersonal wealth serves (…) as a bulwark against government arbitrariness and provides the means to exert personal freedom. Milanović also highlights the particularity of the second wave of globalization, which started after WWII. Unlike the first one, at the end of the XIX century, the new wave has capital mostly going from one rich country to another. More recently, it even started flowing “upward”, from poor to rich countries, as rich people from poor countries, fearful for their money and lives, invest abroad – a phenomenon termed the “Lucas Paradox”, where capital does not flow toward where it is scarcer and with a potentially higher rate of return. In response to such a paradox, technology is now regarded as “embedded” in a given institutional and cultural setup and subject to incentives. Another major difference between the two waves of globalization lies less on the overall magnitude of inequality and more on how its composition changed. From being predominantly driven by class, it has changed to being almost entirely driven by location. In fact, the citizenship and the income class of someone’s parents explain more than 80% of a person’s income. The role played by a person’s effort is small. In accordance, since he cannot influence his country’s growth rate, his best alternative is migration. Shockingly, countries that have done poorly economically would remain, according to the author, with only half or even less of their populations if free migration were allowed. The author also places inequality at the center of the financial crisis of 2007-2008, because huge inequalities in income distribution generated investable funds much larger than could be profitably employed. The political problem of insufficient economic growth of the middle class was then “solved” by opening the floodgates of cheap credit. A lesson well-worth remembering is that, in a democratic system, any excessively unequal model of development cannot coexist with political stability. Understandably, the author misses three key phenomena of the following years: (i) The populist upheaval of the second half of the 2010s, which brought globalization to a standstill; (ii) The more forceful projection of Chinese power in the international setting, in spite of the non-reproducibility of its economic model; and (iv) The shrinking of the “pink” wave in Latin America, with Argentina, Brazil and Venezuela now facing economic stagnation or even collapse as a result of their unique way of conducting economic policies. Still, the challenges of the XXI century summarized by Milanović remain valid: how to bring Africa up, how to peacefully bring China in, and how to wean Latin America off of its self-obsession and bring it into the real world.

  13. 4 out of 5

    Nathik

    It was interesting to read a book on Globalization or should I say Global inequality in post-brexit, trump world. Globalization is the invisible force which affects our income, employment prospect, knowledge and our cost of living. The gain of globalization will be unevenly distributed. Global inequality = Sum of all national inequalities + Sum of all gap in mean incomes among countries According Branko Milanovic, we will continue to the below trends due to globalization. 1. Rise of the "globa It was interesting to read a book on Globalization or should I say Global inequality in post-brexit, trump world. Globalization is the invisible force which affects our income, employment prospect, knowledge and our cost of living. The gain of globalization will be unevenly distributed. Global inequality = Sum of all national inequalities + Sum of all gap in mean incomes among countries According Branko Milanovic, we will continue to the below trends due to globalization. 1. Rise of the "global middle class" whom are mostly located in china and other countries in "resurgent Asia" 2. The stagnation of the groups in the rich countries that are gloablly well-off but nationally middle or lower middle class. 3. Emergence of global plutocracy. Effects on Rich countries: 1. Top earners will make more money from cheap labors. 2. Middle class will squeeze by automation and globalization. 3. Continued polarization of the western world. Populism and Nativism will grow in Europe and US will become plutocratic society. 4. National accounts will becomes less relevant and monetary policies will not be conducted by states. (private monies such as Bitcoin may play a bigger role.) Effects on Resurgent countries: 1. Although the globally inequality is decrease, there will be increase in income inequality with countries. In some years, there will not be rich Americans and poor Chinese. Instead there will be rich Americans and poor Americans, rich Chinese and poor Chinese, rich Russians and poor Russians. 2. Horizontal inequality will not be solved by providing existential equality(policy followed in countries like India). Instead resurgent countries should focus on income inequality. Effects on Individuals: 1. People with scalable jobs will be the real winner of globalization. In these jobs where a person's same unit of labor can be sold many times. 2. Chance and family background will play a much bigger role than ever before.

  14. 4 out of 5

    Charis

    Another good book by Branko. He writes succinctly about inequality in various societies, and his short essays are uniquely titled “vignettes”. In each vignette he explores a dimension of inequality, weaving in contemporary economics with the classical, and philosophical views on inequality. Expect to find great explanations and insights into inequality that you never thought of before, e.g. in Asia, the country that you are born into almost guarantees your per capita income; whereas in Latin & S Another good book by Branko. He writes succinctly about inequality in various societies, and his short essays are uniquely titled “vignettes”. In each vignette he explores a dimension of inequality, weaving in contemporary economics with the classical, and philosophical views on inequality. Expect to find great explanations and insights into inequality that you never thought of before, e.g. in Asia, the country that you are born into almost guarantees your per capita income; whereas in Latin & South America, your class determines your income regardless of country. Hence in some cases, it is almost paramount that you are born in the right society. as an extension of this argument? He explores illegal immigration to Europe from North Africa. A point to drive home is that inequality matters from a political and economic point of view. It drives instability within and between nations, unsustainable immigration, undesired utilitarian and humanitarian outcomes. Quite a fantastic book.

  15. 5 out of 5

    Venky

    While Globalization has had the benevolent impact of bestowing much needed economic, political and social advantages to the underprivileged class, it brings with it its own set of discontents. The most visible scourge of globalisation has been the increasing in-congruence of both wealth and income - a phenomenon that has birthed the undesirable consequence of inequality. One of the pioneers in this domain of Economics has been Branko Milanovic. In this essential book, Milanovic employs the powerf While Globalization has had the benevolent impact of bestowing much needed economic, political and social advantages to the underprivileged class, it brings with it its own set of discontents. The most visible scourge of globalisation has been the increasing in-congruence of both wealth and income - a phenomenon that has birthed the undesirable consequence of inequality. One of the pioneers in this domain of Economics has been Branko Milanovic. In this essential book, Milanovic employs the powerful mechanism of the Kuznets Curve or the Kuznets Waves as he himself prefers to term it (with his own innovative modifications) to lay out the cause and consequences of Inequality. Not restricting himself to the study of inequalities within nations, - which of course have a substantial and significant bearing on the overall Global Inequality - Milanovic using a wide body of research dissects both the usual as well as unusual suspects that are primarily responsible for a rise in inequality. Concentration of capital in the hands of a chosen few; income from capital as well as labour accruing to the same individuals; assortative mating (the act of two highly qualified and top income grossers deciding to bind themselves into the bond of matrimony) and the political influence that is the prerogative of the top "1 percenters" who hold within their possession a cumulative wealth of close to US$3 trillion are all factors which inexorably lead to a wide swathe when it comes to the distribution of income as well as the dispersal of wealth. The most captivating feature of the book lies in its simplicity. Abhorring esoteric equations that in addition to making the reader feel inferior and causing a headache, also give a perception of the condescension of the author, Milanovic prefers to use a narrative that is easy to grasp, and a style that is free flowing. Jargon mongering is resorted to only when absolutely necessary and even there a more comprehensible explanation immediately follows. Graphs and tables supplement the text admirably. However, it is surprising to see the omission of the role which India as an emerging economy could play in reducing inequalities of both income and wealth. While China has a fair share of coverage as is wont to be in any book dealing with Economics on account of its superstar status as an economic super power, trends such as an increasing spate of corruption, non existent human rights, complete disdain to ecological imbalance and rumblings of a return to democracy all combine to pose a real threat to China's economic future even though prospects of a China imploding from within are just far fetched theories. India's burgeoning youth population, Information Technology capabilities, intellectual capital and the advantage of an English speaking citizenry all bode well for a strong and significant future. Maybe in the coming editions of this book, Milanovic would devote more space to the Economic prospects of India and the country's role in stopping the relentless march of inequality. Notwithstanding this fact, Milanovic's work is a superb expression of his craft. "Global Inequality" - A Great Leveler of a work that warrants compulsory reading by everyone wanting to understand the current gap between the haves, have-mores and the have-nots!

  16. 5 out of 5

    Antti Kauppinen

    I worried that a book on global inequality of income and wealth would be boring, but I was wrong: Milanovic offers new insights and sound analysis. Here's a few notable observations. Global inequality has gone down recently, but only because the Asian middle class is doing well and Western middle class is hurting. (Indeed, it may soon happen that the rise of China will contribute to increasing global inequality, as it becomes one of the rich countries.) Within countries, limits of inequality are I worried that a book on global inequality of income and wealth would be boring, but I was wrong: Milanovic offers new insights and sound analysis. Here's a few notable observations. Global inequality has gone down recently, but only because the Asian middle class is doing well and Western middle class is hurting. (Indeed, it may soon happen that the rise of China will contribute to increasing global inequality, as it becomes one of the rich countries.) Within countries, limits of inequality are set by the need for the poor to have enough for subsistence; historically, most of the surplus from economic growth has been appropriated by the powerful. The Industrial Revolution gradually led to the first "Kuznets wave" of shrinking inequality, both for benign reasons like a more educated workforce and the rise of leftist politics, and for malign reasons like wars that reduced the wealth of the rich. Now inequality is rising again within Western countries: technology like robots and IT reduces the need of capital for labourers (and shifts the workforce to low-skill service jobs); globalization increases the profits of large companies by adding markets and allowing production where labour is cheap while making it practically impossible to tax capital; and politics especially in the US is controlled by rich donors, for whom the welfare state is a hindrance, while precarious service workers are disunited and incapable of political action. Still, in global terms, people in the West are doing well, enjoying an unearned "citizenship premium" - if you're poor in Sweden, you're a hundred times better off than being poor in the Congo. This creates an incentive for people in poorer countries to move the Europe and the US. Milanovic has harsh words for "the global inequality of opportunity" that results from closed borders - capital and profits can move, but workers can't. He favours proposals to the effect that there should be different levels of citizenship with different rights, so that migrants would legally be treated as second-rate citizens (rather than illegally exploited, as they actually are, or barred altogether). It would still be in the self-interest of many to migrate (and it would maximize the efficiency of the economy), but resistance from native-born might be reduced, if migrants lacked entitlements or were subject to special taxes. In the final chapter, Milanovic hazards some tentative predictions about the future of global inequality. He's largely pessimistic, given the pro-inequality forces, and the unprecedented global domination of capitalism, which no longer has realistic alternatives (though, sadly, it doesn't entail democracy, which is on the wane as the economic and political power of the middle class is reduced in comparison to the super-rich). Even education doesn't help, as there is already an oversupply of educated labour, and small skill differences can make a huge difference when the same labour can be sold many times (e.g. musical performance distributed to millions rather than a small audience at a time). Since traditional income transfers are no longer feasible, the best solution would be a more equitable distribution of capital - but how could we get there from here?

  17. 4 out of 5

    Lauren Albert

    I am, alas, statistically challenged. It is rather like a form of narcolepsy in which a sighting of statistics sends me into an immediate but temporary state of unconsciousness. So I cannot say I understood all of this book but I found what I did understand fascinating. Milanovic is focused not so much on the "how" of inequality but the "what." He demonstrates inequality within countries, between countries, and globally (i.e. treating the world as if it were one large country). He explains how t I am, alas, statistically challenged. It is rather like a form of narcolepsy in which a sighting of statistics sends me into an immediate but temporary state of unconsciousness. So I cannot say I understood all of this book but I found what I did understand fascinating. Milanovic is focused not so much on the "how" of inequality but the "what." He demonstrates inequality within countries, between countries, and globally (i.e. treating the world as if it were one large country). He explains how to turn the numbers all into "apples" so you are not comparing apples and oranges. The numbers he comes up with are devastating. here is a sampling: We can explain “a person’s income in the world by only two factors, both of which are given at birth: his citizenship and the income class of his parents. These two factors explain more than 80 percent of a person’s income.” 121 Global inequality “is higher than inequality in any single country in the world, even in such paragons of inequality like South Africa and Brazil. . . . Today’s Globa Distribution of income is such that the richest 10 percent of income recipients receive 56 percent of the global income, while the poorest 10 percent receive only 0.7 percent of the global income.” 151-2 “Then the top 10 percent receive more than two-thirds of the total world income, while the top 5 percent get 45 percent. The shares of the bottom 5 and 10 percent of people are almost negligible.” 152-3 He also has a very different theory than most economists on what caused the recent financial crisis--at least a theory I'd never heard before: “The real cause of the [financial] crisis lies in huge inequalities in income distribution that generated much larger investable funds than could be profitably employed. The political problem of insufficient economic growth of the middle class was then ‘solved’ by opening the floodgates of cheap credit. And the opening of the credit floodgates, to placate the middle class, was needed because in a democratic system, an excessively unequal model of development cannot coexist with political stability.” 196

  18. 4 out of 5

    David

    Branko Milanovic’s Global Inequality is an intense examination, though a relatively short book, of economic and political inequality in the developed world (the OECD) but focuses mostly on the West and not very closely on Asia…which is one of the weaknesses of this otherwise compelling read. The upshot of the book is that economic and political inequality will continue and in the wake of this political instability may well rise as well. Milanovic, however, does not seem to take the next step with Branko Milanovic’s Global Inequality is an intense examination, though a relatively short book, of economic and political inequality in the developed world (the OECD) but focuses mostly on the West and not very closely on Asia…which is one of the weaknesses of this otherwise compelling read. The upshot of the book is that economic and political inequality will continue and in the wake of this political instability may well rise as well. Milanovic, however, does not seem to take the next step with this instability and examine the ways in which the disenfranchised will fight back. The author does acknowledge populism and nativism, but not what must be the ultimate consequences of this: civil disobedience, crime, tax revolts, strikes, armed revolt, and insurrection. If inequality continues, if Americans wake up one day and realize they are living not in a representative democracy but a plutocracy who’s to say what will happen. More than likely, the Hamptons will be stormed and the dead will litter the beaches. This is not something to look forward to, but it is what the world, not simply America, is heading for if global economic and political inequality is not brought under control. Mr. Milonovic does not offer any suggestions as to how this will play out, that are believable. Here is the great weakness of the book and his other book, The Haves and the Have-Nots. Unless someone comes up with a solution to this problem, and quickly, the world is heading into a very near-future Dark Age. Not an upbeat message, for a decidedly downbeat book. 3 out of 5 Stars…because no solutions were offered and the book was a bit of a slog.

  19. 5 out of 5

    Scriptor Ignotus

    Global Inequality is a sobering and effective “big picture” analysis of global wealth and income inequality, the forces that drive and diminish it, and the potential future developments that could impact inequality between nations and within them. The neoliberal period, beginning in the late 1970s and extending to this day, ushered in profound economic changes that affected the global and intranational distribution of wealth and income. The last forty years have seen major developments in inform Global Inequality is a sobering and effective “big picture” analysis of global wealth and income inequality, the forces that drive and diminish it, and the potential future developments that could impact inequality between nations and within them. The neoliberal period, beginning in the late 1970s and extending to this day, ushered in profound economic changes that affected the global and intranational distribution of wealth and income. The last forty years have seen major developments in information technology that reward high-skilled and specialized labor, an efflorescence of globalization characterized by the “opening” of China to foreign investment and a newfound ability of Western corporations to outsource their labor costs to the developing world, automation, and the transition of wealthy nations from a Fordist, industrial economic model to a new model in which domestic workers are predominantly employed in a heterogeneous, precarious, and often poorly-compensated “service sector”. The winners and losers of this Second Technological Revolution are clearly demonstrated by Milanović’s famous Elephant Graph, which indicates that most income growth since 1988 has accrued to the middle classes of developing countries (like China, India, and Brazil) and the global top 1%, while people around the 80th global percentile of income distribution—the middle and lower classes of Europe and North America—have seen virtually no income growth at all. Globalization has been a profound success for the developing world and the wealthiest people on Earth, but a formidable challenge for those in the middling and lower strata of income distribution within the wealthy West. Global inequality has declined since 1988—marking the first time since the industrial revolution that the global Gini value has stopped increasing—but inequality in the West, between a flourishing capitalist class and a labor force that is seeing its value decline due to forces outside of its control, is increasing. The global economy is approaching a situation somewhat analogous to that of the early nineteenth century, when inequalities within nations were more pronounced than inequalities between nations. To use Milanović’s terminology, we’ve gone from the world of Marx, where the perceived antagonism was between labor and capital without reference to nationality, to the world of Frantz Fanon, in which inequality was driven by the exploitation of the colonized by wealthy colonial metropoles and was thus racially and geographically determined; but now we seem to be returning to the Marxian paradigm. Inequality in Europe and North America peaked in the late nineteenth and early twentieth centuries, but declined steadily between roughly 1914 and 1980; a phenomenon known colloquially as the Great Levelling. The destruction of physical and financial capital in the world wars, mass military conscription, the end of the rush to the cities in the nineteenth century that exacerbated inequalities between rural and urban workers, improved public education, and heavy taxation on the rich to fund wars and burgeoning welfare states all contributed to a decline in Gini values. That inequality rose sharply in the wake of the industrial revolution and declined in the short twentieth century aligns neatly with the Kuznets hypothesis: one of the most familiar, if oft disputed, predictive models for financial inequality in industrialized societies. Simon Kuznets predicted that as premodern agrarian economies industrialized and grew, the relationship between economic growth and income inequality would be graphed in an inverted U-shape; inequality would rise dramatically as wealth grew beyond bare subsistence levels due to urbanization and the fact that wealth surpluses allowed elites to obtain disproportionate levels of wealth without driving others to starvation, but would then level off and decline as median incomes rose, the rural/urban dichotomy softened, improved public education created broader access to specialized industries, and state policies of welfarism and progressive taxation redistributed wealth. What Kuznets did not anticipate was what appears to be the upward slope of a second Kuznets cycle that has appeared in the West since the 1980s; and so Milanović amends the Kuznets hypothesis to introduce the concept of Kuznets Waves. Post-industrial inequality is not an inverted U-shape that flattens at either end, but a continuously undulating line that moves upward as technological and political changes create (or revive) new classes of the super-rich, and then downward again as the internal contradictions of the new paradigm are either resolved benignly (political reform, reduction of rents as the rest of society catches up with the early innovators, etc.) or discharged malignantly (wars, revolutions, famines). Rather depressingly, Milanović seems to have little faith that benign forces will significantly curtail the rise in income inequality in Western countries any time soon. The inexorable processes of globalization and automation will continue to squeeze the American and European working classes between the economic elites of their own countries and their proletarian counterparts abroad. Greater educational access may play some small egalitarian role, but it is unlikely to be a major factor because even if educational opportunity is fully equalized, there is an upper limit to the interests and aptitudes of the average person that cannot be surmounted by more schooling. As high-paying jobs become more scarce and education is more equalized between socio-economic classes, Western societies will become more nepotistic, as employment decisions will increasingly be made on the basis of personal relationships instead of meritocratic achievement (indeed our elite universities already play this role, because the social status of being an Ivy League graduate is more significant to economic success than the actual quality of education students receive). The mobility of capital has made it more difficult to tax and redistribute by states. The downward slope might only come with global income convergence; when the average incomes of developing nations become similar to those of developed ones. Such a development would presumably end the hollowing out of the first-world middle classes. Or there may be some unforeseen technological development that somehow favors low-skilled workers over high-skilled ones. Or, failing that, we could always have a good old-fashioned civilizational collapse.

  20. 5 out of 5

    Chris Clevenger

    Initially when I saw the title I thought this book was going to be some pro Saul Alinsky dribble, but I saw my Economics professor reading while I was taking a test. Due to my respect for him as a teacher and how much I enjoyed his class, I decided to check it out. First, it's nothing like I thought it would be. It's quite refreshing to read something like this that presents facts and research in a straightforward method. After reading this I couldn't tell you exactly what side of the political Initially when I saw the title I thought this book was going to be some pro Saul Alinsky dribble, but I saw my Economics professor reading while I was taking a test. Due to my respect for him as a teacher and how much I enjoyed his class, I decided to check it out. First, it's nothing like I thought it would be. It's quite refreshing to read something like this that presents facts and research in a straightforward method. After reading this I couldn't tell you exactly what side of the political spectrum Milanovic falls on and I like that. He gives you his findings and its up to you the reader to draw your own conclusions. If you like economics and you like history than you will probably like this book. There is a wide array of vignettes that cover topics that range from capitalism vs socialism all the way to soccer. And for the most part it is written in a way that is readable to the layman. Mostly. At least in the beginning and middle. Toward the end I felt my brain beginning to melt and that may be because I tried to read too much at once or because it just seemed less interesting toward the end. That's why I gave it 3 stars instead of 4. If I could have given it 3.5 I would have.

  21. 4 out of 5

    John Mihelic

    Milanovic has a book coming out, another one on inequality. But he was writing about inequality before Piketty made it cool. I read his blog posts because Thoma points them my way some time, but I thought before engaging with the more current work, I would read this one, intriguingly subtitled “A Brief and Idiosyncratic History of Global Inequality”. The book is set up as three essays that are more wonkish and each essay is filled with some more detailed stories to support the larger ideas behi Milanovic has a book coming out, another one on inequality. But he was writing about inequality before Piketty made it cool. I read his blog posts because Thoma points them my way some time, but I thought before engaging with the more current work, I would read this one, intriguingly subtitled “A Brief and Idiosyncratic History of Global Inequality”. The book is set up as three essays that are more wonkish and each essay is filled with some more detailed stories to support the larger ideas behind the essays. He looks at three different kinds of inequality – that between people in the same nation; that between individual nations; and that between all the world’s citizens. I think that as a popular book about economics it works very well. The vignettes are enough that they can be accessible to someone with little background and they do help explain the more technical aspects of the larger essays. I wish more scientists wrote with the skill Milanovic does here. I am eagerly awaiting that new book, but I’m glad I read up on the background info.

  22. 5 out of 5

    Tia

    In Global Inequality: A New Approach for the Age of Globalization, Branko Milanovic tackles the increasingly salient issue of economic inequality at a global scale, examining the factors which contribute to its growth and decline. Many in the field of development have attempted to characterize this process. Some, like Simon Kuznets, hypothesized that as a nation industrializes, income inequality first increases then decreases, resulting in projections (dubbed Kuznets curves) for ultimately unrea In Global Inequality: A New Approach for the Age of Globalization, Branko Milanovic tackles the increasingly salient issue of economic inequality at a global scale, examining the factors which contribute to its growth and decline. Many in the field of development have attempted to characterize this process. Some, like Simon Kuznets, hypothesized that as a nation industrializes, income inequality first increases then decreases, resulting in projections (dubbed Kuznets curves) for ultimately unrealized reductions in economic inequality in industrialized countries. Famously, Thomas Piketty later argued in Capital in the Twenty-First Century that the long-term result of business as usual under capitalism, where the rate of return on capital is larger than the rate of economic growth, instead leads to increased economic inequality through the concentration of wealth. Piketty’s influential theory effectively displaced Kuznets’s, yet, proposing no practically attainable factors which limit inequality, presented a depressing future. Many, however, disagreed with Piketty’s focus on the difference between rate of return and growth, arguing instead that the distribution of resources in a society depends more on political and economic institutions than economic returns. It is into this debate that Milanovic steps, bringing a stark but clear perspective on a topic that is shaping power and justice considerations globally – a critical topic for development practice. Milanovic, drawing from an extensive data set from as far back as the Middle Ages, identifies forces which contribute to the rise and fall of economic inequality – both within and among nations. While much work has been focused on post-industrial societies, where income growth presents a tempting explanation for inequality, Milanovic expands his analysis to include pre-industrial societies with stagnant income. Through this, he establishes two kinds of forces that drive inequality down: “malign” forces (natural catastrophes, wars, and epidemics) and “benign” forces (social transfers, progressive taxation, and accessible education). Noting that Picketty’s theory does not explain the increase in inequality present in the United States and the United Kingdom in the 18th and 19th centuries, Milanovic’s central work is to propose an extension of the Kuznets hypothesis. He argues that the current upswing in inequality is simply the second Kuznets curve in modern times. And, much like the first, this curve driven primarily by a technological revolution and the transfer of labour from manufacturing into a heterogenous range of skilled services (limiting the ability of workers to organise), but also by globalisation. In a now famous analysis of global growth from 1988-2008, he shows the winners and losers of globalization; while the middle emerging classes of primarily Asia and the very richest globally made huge gains, the poorest globally and the middle-class of rich countries were left behind. Applying this lens, Milanovic addresses our current situation of inequality. He shows that for the first time since the Industrial Revolution, global inequality is being driven by rising gaps within nations rather than being driven by rising gaps among them. Alarmingly Milanovic links inequality, which he predicts to rise in the rich world, to the conditions that precipitated WWI and broke the first Kuznets cycle. These conditions, he claims, which “set the rich world’s inequality on a downward path for the next seventy years were contained in the unsustainably high domestic inequality that existed before.” One would hope this would be a motivation to reduce inequality for even the winners of globalization, but Milanovic is quick to point out how the plutocracy already profits from war. In assessing global inequality, Milanovic connects the problems with migration and the negative impacts of globalization with the disparate value of citizenships due to corollary economic and social benefits. As such, he proposes an intermediary level of citizenship that could entail greater taxes and reduced access to social services. While this may seem anathema to our purported desire for equality within countries, he contends that, not only is this hypocritical since we countenance inequality between countries, tiered citizenship is the de facto case anyway. Though correct in his assessment of our acceptance of international inequality, Milanovic stumbles on what may be core value of the concept of citizenship. From this sincere focus on optimization, he approaches what may be a critical existential question for citizenship in this era: do we strip away rights of some citizens in response to globalization and recognize de facto policy or do we hold fast to an aspiration of equality? Interestingly, Milanovic arguably promotes the latter when he opposes an exclusive focus on “horizontal” inequality. Instead, he contends that such equality will follow from the narrowing of economic classes, an argument reminiscent of Marx. While this has merit, some, like bell hooks, would maintain that the exclusive focus on income misses the heart of such battles for equality, as income disparity is just one of many intersecting forms of oppression. Lately, many popular books on development are either derivative, simply rehashing already established practices like randomized controlled trials, or so extreme as to be practically inapplicable, like the call to cease all aid. Milanovic bucks this trend, starting from scratch to build a robust understanding of inter and intra-national inequality. The picture he paints is mostly bleak, but for those who would hear it, it is a call to arms. Though some his policy recommendations are at times reductive in their focus on the economic aspects inequality, others could provide the foundation for a new image of development funded by rich countries. Regardless of political leanings or opinions on the future of development, this compelling book should be read by any interested in the field.

  23. 4 out of 5

    David

    The Have and the Have-Nots is an excellent, if occasionally uneven, history of global inequality and globalization. With the rise of the popular right and the more extreme versions in the alt right it has become necessary to understand the origins of the lower-classes/working classes/working poor's rage. Make no mistake about, Brexit, Trump, and the European Popular Right are expressions of a deep-seated rage. This type of anger stops at the ballot box first before continuing on to civil disobed The Have and the Have-Nots is an excellent, if occasionally uneven, history of global inequality and globalization. With the rise of the popular right and the more extreme versions in the alt right it has become necessary to understand the origins of the lower-classes/working classes/working poor's rage. Make no mistake about, Brexit, Trump, and the European Popular Right are expressions of a deep-seated rage. This type of anger stops at the ballot box first before continuing on to civil disobedience; then insurrection. Political leaders, elites, and technocrats need to start listening to the people or they will destroy democracy where it has achieved its fullest expression. Would the world long survive with it core constituency? Probably not. Mr. Milanovic examines the issue of global inequality and how it came about...but not so much about what can be done about. A very useful book 4 out of 5 stars

  24. 4 out of 5

    Andreas

    Probably the best book I'll read this year. Milanovic provides plenty of data, presents plausible hypotheses regarding the evolution of national equality and the current rise of populism, and asks provoking philosophical questions, in particular about migration and the citizen premium. It has made me question some of my own core beliefs, which only the best books do. Highly recommended. Probably the best book I'll read this year. Milanovic provides plenty of data, presents plausible hypotheses regarding the evolution of national equality and the current rise of populism, and asks provoking philosophical questions, in particular about migration and the citizen premium. It has made me question some of my own core beliefs, which only the best books do. Highly recommended.

  25. 5 out of 5

    Kate

    Perhaps a little too idiosyncratic for my purposes and knowledge level, alas.

  26. 4 out of 5

    Jordan

    Essays are too much dry macroeconomics but the vignettes add a lot of character to the book.

  27. 5 out of 5

    Ed

    See review at https://edsteffes.me/2016/08/03/globa... See review at https://edsteffes.me/2016/08/03/globa...

  28. 5 out of 5

    Aisha Bowen

    The point was made early on and what repeated over and over for the rest of the book. Reminds me of a college essay that has a page requirement that you need to fill.

  29. 5 out of 5

    Don

    Globalisation has never been anything other than the most complex and contradictory of phenomena, producing outcomes that evade being characterised in simple binary terms as 'good' or 'bad'. As far as it has impacted on equality across the planet the following have to be taken into account: (1) For those groups between the 40th and 60th percentiles of global income distribution - around one-fifth of the world's population - it has produced dramatic gains in wealth. (2) Contrariwise, those on or ar Globalisation has never been anything other than the most complex and contradictory of phenomena, producing outcomes that evade being characterised in simple binary terms as 'good' or 'bad'. As far as it has impacted on equality across the planet the following have to be taken into account: (1) For those groups between the 40th and 60th percentiles of global income distribution - around one-fifth of the world's population - it has produced dramatic gains in wealth. (2) Contrariwise, those on or around the 80th percentile - the lower middle classes of the rich world - have seen little or no gain in their net wealth across the decades since 1988. (3) However, as illustrated by the famous 'elephant curve' graph, Everyone in the 90th percentile onwards - the upper segments of the middle classes plus the unabashed rich - have benefitted from a rocketting increase in their share of global income. Milanovic explains that this outcome was not predicted by the workhouse approach to understanding the trajectory of inequality, developed in the 1950s as the Kuznets hypothesis. This had predicted that inequality tended to rise during the early stages of economic growth in national societies, as larger sections of the population moved away from low median income levels. This happened because the relatively small cohorts of educated/skilled people found greater opportunities to benefit from their situation and leave their compatriots lagging behind. At some point this would change and the tendency towards increased inequality would be reined in as economic development created more educational opportunities for other citizens. Political pressure to moderate excessive differences between citizens would also kick in, producing welfare societies to one degree or another. The Kuznets hypothesis allowed economists to understand the forces that had been underway which had turned in the inegalitarian 19th century into the egalitarian 20th. But Kuznet reasoning did not facilitate understanding of the direction of equality under conditions of globalised economic markets. Why was the richest fraction of the world's population opening up such a huge gap in its wealth and that of all the rest? Milanovic suggests a number of reasons - ranging from the emergence of a high-paid service sector covering areas like finance and law and the tendency of high-income earners to marry other high-income earners, thus doubling up on their fortunes. More important has been the vastly greater opportunities that have existed under the Washington Consensus version of globalisation for capital to move freely and rapidly out of its home jurisdictions, finding possibilities for greater returns aboard and, significantly, the wealth to be squirreled away in places that render it safe from taxation. In this way globalisation has prevented the logic which the Kuznets hypothesis saw in the downward segment of its inverted U curve coming into force. The capacity of democratic processes to counter excessive inequality through taxation and welfare regimes has been resisted by a new global plutocracy which uses its power and wealth to insist on laws that allow it to move its wealth unimpeded across national frontiers. Meanwhile citizens, whose hopes of earning a higher income require a similar freedom to move to places where they can command a higher return on their principal asset - their labour power - continues to be checked by immigration control measures. Milanovic argues that there are no safe predictions that can be made for the future direction of equality across the planet. If Asian growth rates remain higher than those in the rich world, and if Africa and Latin America can be induced into participation in similar development, then the current hugh disparities which are a reflection of the place where the individual happens to be, will gradually be reduced and global inequality brought down. And if added to this some means of restricting the privileges of the plutocratic classes were to come into play then the direction taken by history in the mid-20th century in reducing inequality might show the direction ahead. As things look at present there are no compelling reasons to think that we are moving forward in this way. The consensus among mainstream political and economic practitioners favours doing nothing that will rock the boat which set sail back in 1988, even if numerous downturns and the near wrecking of the Atlantic economy in 2007/8 and the political crisis that have produced paralyse in the EU and the inanities of the Trump presidency in the US, suggest that they should be less complacent. And for working people, those barriers to their free movement are higher today than they ever have been before.

  30. 4 out of 5

    Misha

    My reading has been somewhat protracted as I got the silly idea of working at work. Anyhoo, I am on page 105 in "The Haves and the Have Nots" by Branko Milanovic and wanted to share my impressions. This is one of those books that are useful but annoying to read. M. is naturally fond of the subject of inequality but to him inequality is the major if not the sole source of all his theorizing. This is like trying figure out why the cars run by listening to the sound of the engine but not caring to look un My reading has been somewhat protracted as I got the silly idea of working at work. Anyhoo, I am on page 105 in "The Haves and the Have Nots" by Branko Milanovic and wanted to share my impressions. This is one of those books that are useful but annoying to read. M. is naturally fond of the subject of inequality but to him inequality is the major if not the sole source of all his theorizing. This is like trying figure out why the cars run by listening to the sound of the engine but not caring to look under the hood. Milanovic's theories and explanations are shallow and naive at best. But let us start with the interesting and useful things first. Naah, what's the fun in that? M. thinks that the reader would not be able to handle tables and graphs. There are none in the book. It gets annoying. For example, he discusses the Gini coefficient, yet he mentions the coefficients of various countries, occasionally multiple times, across several pages pages without bothering to provide a simple table. I had to look up the coefficients table on the web. One of the sidebars (he cutely calls them vignettes) is fun. He compares the riches of the famously rich people in history. As a basis for comparison he uses the number of workers (of that country) the person would be able to afford on the interest of off his fortune. This is almost Marxian. So, Marcus Crassus (of Spartacus Fame) - 32K people; Andrew Carnegie - 48K; Rockefeller - 116K, (poor) Bill Gates - 75,000; Mikhail Khodorkovsky of Russia almost took the cake with 250K people but was upstaged by Mexican Carlos Slim with $440K Mexicans. Milanovic surmises that Khodorkovsky is a lot more dangerous to the powers that be than US moguls and thus he sits in jail. Another one of his vignettes talks about inequality of the roman empire compared to the inequality of the US. M. says that the top to bottom was about as unequal yet most people in Rome lived at or just above the subsistence level so there were no "middle class". The vignette on egalitarianism of the Soviet Union and shadowy income and privilege distribution is annoying. He might be even right in his statements, but with his hatchet job of approach to history and society I still want to kick him in the face. There was a vignette of comparison of arrondissement (districts) of Paris and their migration through history. There was no rhyme or reason to it that I can discern. There was an interesting discussion of income redistribution through taxation. There was *gasp* a graph: the bottom decile gains slightly less than 4% of income in the US and over 6% in Germany. It turns out that the middle class deciles (5th and 6th) actually lose through the redistribution yet consistently vote for it. M. is puzzled by it but says that the middle class gains some security that way (in case of injury or for retirement). Then comes the chapter with one of the major theses of the book. M. compares the breakups of Yugoslavia, USSR and the current situation in China. It turns out in the USSR the gap between the GDP between the poorest republic and the richest was 6 to 1 (compared to US' states 1.5 to 1) and Yugoslavia's was 8 to 1. He claims this inequality was the major reason for these countries' collapse. He then talks about China where the per capita GDP difference between provinces is 10 to 1. On the basis of this M. predicts the breakup and dissolution of mainland China. No never mind the differences in ethnic makeup, historical circumstance and whatever not between his examples. Presently, M. described Pareto's "law" of income distribution (there is always about the same proportion of rich people, Pareto calls them aristocracies, regardless of the particular political or economic system of the society) and Kuznets' curve (primitive societies were about equal of the subsistence level then became more unequal and then, as modern democracies developed, became more equal again). It is amazing as all this (which is essentially glorified listening to the car's engine without bothering to explain how it works) is taken seriously as science. Naturally, Marx is roundly dismissed in a couple of sentences. Now M. introduced purchasing power dollars (PPP$) which is often used and always puzzled me (the money is indexed by the basket of goods and services they can buy). The Japanese earn more money than the Americans yet, their goods are more expensive so the Americans come out ahead in PPP$. Milosevic, I mean Milanovic, improves significantly once he gives up his meager attempts at trying to provide any kind of serious analysis of the causes of inequality and just starts to slice and dice the data to paint a rather grim picture of this unequal world. And M. is actually decent at it. By using the data he thoroughly debunks the neoclassical myths that are often stuck in people's heads. The main thesis of what he calls globalization is that the countries' incomes would converge since poor countries' income would grow faster than the rich ones. The reasons are: - Poor countries would get most direct foreign investments because they have lower wages and higher return on investments. It turns out the opposite is true. The capital mostly flows from rich countries to other rich countries. China does quite well as far as third world countries go $138 bls in direct foreign investments (DFI) in 2007. Meantime, the US got $240 bls. Actually, China gets about the same as the Netherlands and worse than France and Great Britain. China is, however, an exception. 2007 was a breakout year for India: it attracted $23 bls, half as much as Australia. Before it averaged $4-6 bls. The capitalists of rich countries tend to lend money to each other afraid of the risks associated with investing in the third world. What's worse, for the same reason, the investments are actually flowing upwards from the poor to the rich countries. - Poor countries can have access to technologies already developed in the first world: it is easier to copy than to design anew. Aha, as soon as microsofts and the pharmaceuticals stop charging for licensing everything would be peachy. - The poor countries would "borrow" the ideas as far as governance and economic policies that work. Yeah right, every country would just adopt the american-style bourgeois democracy as soon as they get rid of their dictators. Then, Milanovic kicks Marx again for a chapter. I just ignored him for he knows not what he does. Thankfully, Milanovic started using graphs. He breaks up the populations of different incomes into ventiles (one-twentieths), averages their income and compares those. The results are striking. The poorest ventile in the US is richer than the richest in India. And that is with US being rather unequal (Gini is in mid-40ies) Speaking of Gini-s. Milanovic calculates that world's total Gini coefficient is between 70 and 80. For comparison, Brazil is a very unequal country where some of the world's poorest and richest people live. Its Gini is in the 60-ies. M. talks about the dynamics of inequality. It actually stayed about the same since 1980. However, that masks the fact that most of the third world countries are getting comparatively poorer while China and India are getting richer. You'd think if you save and work hard, you'll make it in the world, right? It turns out that statistically, 80% of your income is determined by your citizenship and your strata of birth. The other 20% goes to for such factors as gender, race, age, luck and, oh, yeah, work ethics. Naturally, the best way to improve your economic lot is to immigrate to rich country. Hmm, that sounds familiar, I think somebody I know has done that. M. talks about the plight of "haraga" - Africans dying to make it to Europe on makeshift boats. M. talks about World's "middle class" - people within 25% of the world median income. In 2005, the median yearly income was PPP $1,225. Also, turns out the world does not have much of a middle class: only 14% are within the bracket. For comparison, the figure is about 40% for developed countries. M. compares inequality of Europe and the US. The US is a lot more unequal to any of the european countries. However, the states within the Union are relatively homogeneous. The ratio between per capita income in the richest and poorest state is 1.5. The ratio in Europe is 7 to 1. The ventiles of the richest (Luxembourg) and the poorest (Romania) countries do not overlap. That is, statistically, all Luxembourgers are richer than all Romanians. Another interesting chapter is on colonies. The idea is that the maximum amount that can be extracted from the country is when all the population is kept at the subsistence level while a tiny (statistically negligible) elite appropriates all the surplus. Naturally, the larger the GDP per capita in a country, the more can be appropriated. They draw a curve call Inequality Possibility Frontier for countries with different GDP per capita. Colonies such as India, Nuevo Espana (Mexico), Kenya lie neatly near this curve. The colonizers sucked these countries dry.

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