The lingering income gap between the world’s richest and poorest citizens may be the biggest risk to the global economy over the next decade, says the World Economic Forum’s Global Risks 2014 report.
That report assesses the top 31 risks that will weigh on the global economy in coming years. Its list is broken up into five categories: economic, environmental, geopolitical, societal and technological issues.
Read more on which events may cause market swings over the next decade.
Also check out Oxfam’s summary of the World Economic Forum’s findings here.
On the topic of wealth inequality, Oxfam finds, “Almost half of the world’s wealth is now owned by just 1% of the population [and]…the wealth of [that segment] amounts to $110 trillion–that’s 65 times the total wealth of the bottom half of the world’s population.” Further, the top 1% of global earners is comprised of only 85 people.
Also consider, says Oxfam, that though global growth is expected to benefit markets over the next few years, only these top earners are likely to capture it. “In the U.S. [alone],” says the report, “the wealthiest 1% captured 95% of post-financial crisis growth since 2009, while the bottom 90% became poorer.”
What’s more, “The richest 1% [across the world] increased their share of income in 24 out of 26 countries for which we have data between 1980 and 2012,” says the report.
The group suggests the following initiatives, among others, will help close the income gap between wealthy and poor citizens:
- A crackdown on tax dodging
- Investment in universal access to healthcare and education
- The strengthening of wage floors and workers’ rights
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