The widening gap between the rich and poor has emerged as one of the biggest threats to the global economy, said the World Economic Forum in a report published on Wednesday, with its disruptive potential contributing to the Brexit vote and Donald Trump’s victory in the U.S. presidential election.
Worsening income inequality can’t be remedied by higher economic growth alone and is casting doubt on the very future of capitalism, according to the report, which surveyed 750 business, government and academic leaders on the largest risks to the planet.
“There is a widespread sense that the growth model we’ve been following in past years does not deliver, in terms of increasing the incomes of the population,” said Margareta Drzeniek Hanouz, head of global competitiveness and risks at the World Economic Forum at a press conference. “There is a call for a more fundamental rethink of how we generate growth and how we distribute growth.”
Income inequality has been declining for the last 30 years on a global level as countries in Asia and elsewhere play catch-up with more developed economies. However, in large countries like the U.S., U.K., Canada, Ireland and Australia, the 1% have disproportionately benefited from economic growth.
Read more at: Rising Income Inequality Is Throwing The Future Of Capitalism Into Question, Says World Economic Forum
