The Myths of Inequality

How capitalism disproportionately benefits the poor

Steven Covey, author of the Seven Habits of Highly Effective People, said that “the main thing is to keep the main thing, the main thing.”

This is especially important when looking at poverty reduction where statistics and figures can obscure the larger picture of what is happening in the lives of real people over time.

So what is the main thing?

It is making life better for individual human beings.

I’ve done a lot of thinking and written now in several articles about how poverty decreases as an economy grows with or without government intervention.

Below we can see that going back to the 19th century, often periods of poverty reduction coincided with periods of increasing wealth inequality, such as the period from 1820–1940 in the U.S. and the U.K. This tells us, at the very least, that not only should we not equate poverty with inequality, but often the two have an inverse relationship.

Source: https://www.cgdev.org/blog/poverty-rich-world-when-it-was-not-nearly-so-rich