A World Ranked by Countries
Your strongest income predictor is country of birth. Global inequality stacks stratification between societies over stratification within them.
The Map's Vocabulary
- Income tiers: High, upper-middle, lower-middle, and low, measured by GNI per capita.
- Purchasing power parity (PPP): Corrects income because a euro buys different amounts of life in Oslo and Nairobi; uncorrected GNI overstates gaps by about half.
- Human Development Index (HDI): Measures development via money, health, and education.
The Empirical Shock
East Asian growth pulled over a billion people out of extreme poverty via compounding: . A 7% growth rate doubles an economy each decade while a 1% rate barely moves.
Pitfall: Never compare cross-country living standards without PPP correction.
Three Theories of Global Gaps
Global inequality is explained by three major theoretical families, plus an institutional view:
| Theory | Gap exists because... | Prescription |
|---|---|---|
| Modernization | Societies haven't climbed Rostow's staircase (traditional to mass consumption) | Diffuse tech, investment, education |
| Dependency | Core powers locked poor economies into exporting raw goods | Restructure world trade |
| World-Systems | A global capitalist structure divides the world into core, periphery, and semi-periphery | Understand zone mobility |
| Institutionalist | Countries lack inclusive institutions rather than extractive ones | Build inclusive legal and political rules |
For business, the bottom of the pyramid is both a moral fact and a major market map.