Fighting inequality and poverty requires a more humane view of economics

Oxfam is right to highlight disparities in wealth. When influential charity Oxfam published its report, “An Economy for the 1%”, it was well timed to coincide with 2017’s January meeting of the world’s rich and powerful at the Swiss ski resort of Davos.

Oxfam’s findings were widely discussed, including in a weekly news magazine aimed at eight to 14-year-olds. Much of this discussion focused on the report’s headline statistics, which told us most strikingly that “since 2015, the richest 1% has owned more wealth than the rest of the planet”. Or that the eight richest men in the world own as much wealth as 3.6 billion people – about half of the world’s population. It also pointed out that the incomes of the poorest 10% increased by less than US$3 a year between 1988 and 2011, while the incomes of the richest 1% increased 182 times as much.

These figures are certainly startling. But in response, the Adam Smith Institute questioned Oxfam’s interpretation of the existing data and its focus on the wealth of the rich rather than the welfare of the poor. Growth in the income of those at the bottom, the related reduction in global poverty and improvements in life expectancy, were the key issues for the economic think tank.