Global Inequality
Chapter 9
Stratification, Class, and Inequality
• Who was the world’s richest person in
2012?
– (a) Bill Gates, founder of Microsoft
– (b) Warren Buffett, investor, CEO of
Berkshire Hathaway
– (c) Carlos Slim Helu, head of Grupo
Carso, a global conglomerate based in
Mexico
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Unanswered Questions
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Basic Concepts
• Globalization
– The increased economic, political, and
social interconnectedness of the world
• Global inequality
– The systematic differences in wealth and
power between countries
– The increased economic, political, and
social interconnectedness of the world,
plays an important role in establishing
differences in wealth
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Basic Concepts
• GNI is a measure of a country’s yearly
output of goods and services per
person.
• Countries divided by per-person
gross national income (GNI)
– 70 high-income countries
– 54 upper-middle-income countries
– 54 lower-middle-income countries
– 36 low-income countries
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Basic Concepts
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Basic Concepts
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Basic Concepts
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Basic Concepts
• High-income countries
– Highly industrialized
– 14.2 percent of the world’s population
– 66 percent of the world’s total income
– the standards of living are generally
higher than in other parts of the world
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Basic Concepts
• Middle-income countries
– Most diverse group
– Varying levels of industrialization
– 71.7 percent of the world’s population
– 31 percent of the world’s total income
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Basic Concepts
• Low-income countries
– Diverse group
– Mostly agricultural, in early phase of
industrialization
– 12 percent of the world’s population
– 7 percent of the world’s total income
– High population growth (Grew 2.6 times
faster than high income countries)
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Theories of Global Inequality
The theories that attempt to explain global
inequality fall into four categories:
•Market-oriented
•Dependency
•World-systems
•Global commodity chains theories
Theories of Global Inequality
• Market-oriented theories
– Argue that the best possible economic
consequences will result if individuals
are free to make their own economic
decisions, uninhibited by governmental
restraint
– Governments should not dictate which
goods to produce, what prices to charge,
or how much to pay workers.
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Theories of Global Inequality
• Market-oriented theories
– W. W. Rostow’s modernization theory
suggests that low-income societies
develop economically only if they give
up their traditional ways and adopt
modern economic institutions,
technologies, and cultural values that
emphasize savings and productive
investment.
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Theories of Global Inequality
• Market-oriented theories
– W. W. Rostow’s modernization theory
• Traditional stage
• Takeoff to economic growth-poor countries
begin to save and invest money for the future
• Drive to technological maturity-countries
continue to invest in industry and
infrastructure to support it
• High mass consumption
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Theories of Global Inequality
• Market-oriented theories
– Neoliberalism
• Free market forces, achieved by
minimizing government restrictions
on business, provide the only route to
economic growth
• Neoliberalism is built into many
arguments in favor of economic
globalization.
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Theories of Global Inequality
• Dependency theories
• reject the notion that a society’s values and
norms are to blame for its economic status.
– Marxist theories that argue that the poverty
of low-income countries stems directly from
their exploitation by wealthy countries and
the multinational corporations that are
based in wealthy countries
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Theories of Global Inequality
• Dependency theories
– Colonialism is the root of economic
exploitation
– Western nations and Japan established
colonies to acquire raw materials such as
the petroleum, copper, and iron needed
for factories or to control markets.
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Theories of Global Inequality
• Dependency theories
– Dependent development
• Poor countries can still develop
economically but only in ways shaped by
their reliance on the wealthier countries
• still has the potential to be exploitive
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Theories of Global Inequality
• World-systems theory
– Countries are connected by the
expansion of a capitalist world economy
made up of core, semiperiphery, and
periphery countries
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Theories of Global Inequality
• World-systems theory
– World market for goods and labor
– Division of population into economic
classes-particularly capitalists and
workers
– International system of formal and
informal political relations between
countries
– Division of world into three unequal
economic zones-wealthy exploit poor
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Theories of Global Inequality
• World-systems theory
– Core
• Made up of the most advanced industrial
countries that share most of the profits of the
world economic system
• The United States, Japan, and western
Europe are part of the core.
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Theories of Global Inequality
• World-systems theory
– Periphery (low-income, mostly
agricultural)
– The core exploits the periphery’s natural
resources and labor.
• Made up of countries that have a marginal
role in the world economy and are thus
dependent on the core producing societies
for their trading relationships
• Child labor and other humanitarian issues
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Theories of Global Inequality
• World-systems theory
– Semiperiphery (semi-industrialized,
middle-income countries)
• Made up of countries that supply sources of
labor and raw materials to the core
industrial countries and the world economy
but are not themselves fully industrialized
societies
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Theories of Global Inequality
• World-systems theory (Nigeria)
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Theories of Global Inequality
• Global commodity chains theory
– Worldwide networks of labor and
production processes yielding a finished
product
– Barbie’s production story begins in a petroleum
field in Saudi Arabia and ends in a toy factory
in China before showing up on the shelves of
your local retail store
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Theories of Global Inequality
• Global commodity chains theory
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Theories of Global Inequality
• Evaluating theories of global
inequality
– Market-oriented theories recommend adoption of modern
capitalist institutions.
– Dependency theories emphasize how wealthy nations have
exploited poor ones.
– World-systems theory analyzes the world economy as a whole,
looking at the complex global web of political and economic
relationships that influence development and inequality in poor
and rich nations alike.
– The theory of global commodity chains focuses on global
businesses and their activities rather than relationships
between countries.
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Research on Global Inequality Today
Research on Global Inequality Today
• Health
– Differences in access to and quality of
health care facilities
– Differences in overall cleanliness (water,
sanitation, soil, air)
– Rates of infectious diseases vary
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Research on Global Inequality Today
• Hunger, Malnutrition, and Famine
– Differences in access to and quality of
food due to natural and social forces
• Droughts
• Conflict
• Economic problems
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Research on Global Inequality Today
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Research on Global Inequality Today
• Education and Literacy
– Quality and years of education affect
economic development
• High-wage industries need skilled
workforce
• Educated people are more likely to escape
poverty
• Educated people have fewer children
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Unanswered Questions
• Is Global Poverty Increasing or
Decreasing?
– Percentage of people living on less than
$1.25 per day declined between 2005
and 2008
– The steep drop in the percentage of
people living in extreme poverty is not
matched, unfortunately, by an equally
steep drop in the number of people.
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Unanswered Questions
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Unanswered Questions
• What about Inequality Between
Countries?
– Widening global gap between rich and
poor countries
– Newly industrializing economies (NIEs)
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Unanswered Questions
• What Does Rapid Globalization Mean
for the Future of Global Inequality?
– Technology innovators-regions that
provide most of the world’s
technological inventions (15%)
– Technology adopters-regions adopt tech
developed elsewhere (50%)
– Technologically disconnected (35%)
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Discussion Question: Thinking Sociologically
Summarize the four types of theories that
explain why there are gaps between nations’
economic development and resulting global
inequality: market-oriented theories,
dependency theories, world-systems theory,
and state-centered theories. Briefly discuss
the distinctive characteristics of each type of
theory and how it differs from the others.
Which theory do you feel best explains
economic development gaps?
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Discussion Question: Thinking Sociologically
This chapter states that global economic
inequality has personal relevance and
importance to people in advanced, affluent
economies. Briefly review this argument.
Explain whether you were persuaded by it or
not.
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