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Inequality, Uprisings, and Conflict in the Arab World

The Middle East and North Africa (MENA) represents a puzzle. The region had been making steady progress in terms of the World Bank’s twin goals of eliminating extreme poverty and boosting shared prosperity. The percentage of poor people, already low, was declining in all economies, except Yemen .

The incomes of the bottom 40 percent, measured at 2005 PPP-adjusted per capita expenditures, were growing faster than average expenditures in most Arab economies for which information was available . In fact, the ratio of expenditures of the bottom 40 percent to the average was higher than all regions except Latin America and the Caribbean.  
Not only did MENA reach the Millennium Development Goals related to poverty reduction and access to infrastructure services (especially, drinking water and sanitation, and internet connectivity), but it made important strides in reducing hunger, child and maternal mortality, and increasing school enrollment (Iqbal and Kindrebeogo, 2015). Inequality of opportunity declined in some countries, according to evidence in Hassine (2011). Finally, expenditure inequality, measured by the Gini index, did not worsen in most MENA economies in recent years and remained low to moderate by international standards.

Yet, starting in late 2010 there were revolutions in Tunisia, Egypt, Yemen and Libya, a rebellion that has led to a protracted civil war in Syria, and widespread popular discontent in many other countries. The Arab Spring events caught the world by surprise. Standard development indicators failed to capture or predict the outburst of popular anger during the spring of 2011. What could explain this conundrum, which we refer to as the ‘Arab inequality puzzle’? Was economic inequality much higher than suggested by household expenditure data? Or were the grievances linked to factors other than economic inequality, such as decline in the overall quality of life, growing corruption, and lack of freedom, among others?  
Answers to these questions are beginning to emerge from new research on monetary inequality (Hassine, 2015; van der Weide et al. 2015a, 2015b; Johannesen, 2015) and subjective wellbeing in MENA (Arampatzi et al., 2015), conducted as part of a comprehensive study on economic inequality, uprisings, and conflict in the Arab world (Ianchovichina et al., 2015). This section of the MENA Economic Monitor summarizes the main findings emerging from this new research and proposes a possible answer to the Arab inequality puzzle

 

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  • Dec 11, 2015
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