Global Inequality: A New Approach for the Age of Globalization
By Branko Milanovic
Cambridge, Mass.: Harvard University Press, 2016.
Pp. ix, 299. $29.95 hardcover.
In several books and many journal articles, Branko Milanovic has established himself as one of the world's leading authorities on conceptualizing and measuring economic inequality. With his new book, Global Inequality he rises to a new level of scope and comprehensiveness.
After a brief introduction, the book is organized into five chapters. The first is on how recent developments (such as the rise of the global middle class, the decline of the middle class in rich nations, and the rise of the top one percent) are illuminated by Milanovic's comprehensive data and analysis. The core of the book's argument is in chapter 2, on inequality within nations, and chapter 3, on inequality among nations. The fourth chapter anticipates the future of inequality, and the final chapter reviews major issues and speculates about wider implications of the book's analysis.
This book provides a context that helps us understand a wide variety of important questions and issues, from the current populist revolt in rich countries to the absence of equality of opportunity in the world. Although a political worldview underlies the analysis, the book is scholarly and not at all polemical.
The central idea for understanding inequality within countries is based on an adaptation of the famous Kuznets curve, which argues that inequality rises and then falls with economic development in an inverted U. Milanovic's innovation is to suggest that there may be no single Kuznets curve for a given country but rather a series of Kuznets curves, or waves, responding to new technological revolutions. For a while, the Kuznets curve was the main model explaining inequality, but since inequality began rising again in the 1980s, Simon Kuznets's original model became less useful and relevant. With the introduction of the possibility of multiple curves linked to new innovations, Milanovic makes the Kuznets idea relevant again.
Milanovic explains his modification with the idea that there is "a new (second) technological revolution, characterized by remarkable changes in information technology, globalization, and the rising importance of heterogeneous jobs in the service sector. This revolution, like the industrial revolution [sic of the early nineteenth century, widened income disparities" (p. 54). The data for chapter 2 are several historical...