Nearshore Americas

Report: Income Inequality Rises in Mexico and Chile

By Narayan Ammachchi

The gulf between haves and have-nots is widening at a rapid pace in Mexico and Chile, shows a recent OECD (Organization for Economic Cooperation and Development) survey conducted in 33 countries across the world.

The international organization has blamed the 2008 global economic crisis for the widening gulf, because inequality worsened more between 2007 and 2010 than in the previous 12 years.

Inequality was already widespread in several countries by the time they slipped into recession. “In some of the countries where the crisis hit harder, poorer households either lost more income from the recession or benefited less from recovery,” the report pointed out.

In the countries surveyed, the richest 10 percent earned 9.5 times the income of the poorest 10 percent in 2010.

The other countries where the economic disparity widened further include Turkey, the United States and Israel.

“Nordic and central European countries have the lowest inequality of disposable income while inequality is high in Chile, Mexico, Turkey, the United States and Israel,” the report stated.

Incomes of poorer households also fell by more than 5% annually in Mexico, Iceland, Greece, Ireland and Estonia.

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“A relative income poverty – the share of people having less income than half the national median income –affects around 11% of the population on average across OECD countries, with large country differences,” the report added.

Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

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