Israel is one of the most unequal countries in the world in terms of wealth. This is according to World Inequality Report 2022, published this week by The World Inequality Lab.
Israel is described as an affluent country. Its average national income for the adult population is roughly $71,000. This is higher than affluent Western European countries like France and the UK, but lower than the US. But this is just the average and not the mean. The report says that Israel is one of the most unequal high-income countries.
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The bottom 50% of the population only earns about $18,000 a year. This means that the top ten percent of earners in the country earn 19 times more per year than the bottom half. So, Israel has inequality levels similar to those in the US, with the bottom 50% of the population earning only 13% of total national income, while the top 10% share is 49%.
And this is nothing new for Israel either. The report also explains that the country has seen very high overall income inequality over the past 30 years. The researchers cite Israel’s economic liberalization reforms that it undertook in the mid-1980s and 1990s led as a cause for the marked increase. “While inequalities have slightly decreased since 2012, they remain at a very high level, in the context of a highly segregated society,” the report says.
Worldwide, the report says Global wealth inequalities are even more pronounced than income inequalities. The poorest half of the global population barely owns any wealth at all, possessing just 2% of the total. In contrast, the richest 10% of the global population own 76% of all wealth.
The researchers also show that while inequality has increased within most countries, over the past two decades, global inequalities between countries have declined. The gap between the average incomes of the richest 10% of countries and the average incomes of the poorest 50% of countries dropped from around 50x to a little less than40x. At the same time, inequalities increased significantly within countries. The gap between the average incomes of the top 10% and the bottom 50% of individuals within countries has almost doubled, from 8.5x to 15x.