NewDelhi: There is a pattern in global income data that is uncomfortable to look at directly. The share of total income flowing to the wealthiest one percent of people fell for several decades after the Second World War, creating a period of broadly shared prosperity that many countries came to take for granted.
Then, around 1980, the trend reversed. Quietly at first, then with gathering momentum, the income share of the very rich began climbing again. In 2024, it sits close to where it was a century ago — before two world wars, before welfare states, before progressive taxation became standard practice across the developed world.
The data comes from the World Inequality Database and has been visualised by Our World in Data. It tracks the income share of the top one percent across multiple countries from 1910 to 2024, and the shape it draws is consistent enough across very different economies to be impossible to dismiss as coincidence.
India: almost back to where it started
The Indian numbers are among the sharpest in the dataset. In the early twentieth century, the richest one percent of Indians earned approximately 23 to 24 percent of the country’s total income. That figure fell steadily after independence — the result of land reforms, nationalisation, high marginal tax rates on large incomes, and an economic model that prioritised redistribution alongside growth. By 1980, the income share of India’s top one percent had dropped to roughly 6 to 7 percent. That was the low point.
What happened next was a near-complete reversal. Economic liberalisation began in 1991. Global trade opened up. Private capital flowed in. Technology and finance created enormous new fortunes at the top while wages in the middle grew more slowly. By 2024, the richest one percent of Indians earn approximately 22 to 23 percent of the country’s total income — almost exactly where the figure stood before independence, and more than three times the level recorded at the 1980 low point.
The gains from decades of strong economic growth have not been evenly shared. A small group at the top has captured a disproportionately large portion of what India’s expanding economy has produced.
The United States: a century of change that ended where it began
The American data tells a similar story with slightly different contours. In the 1920s and 1930s, the top one percent earned around 22 to 23 percent of total US income. The Great Depression, the New Deal, high wartime taxes, and the expansion of the middle class through unionisation and government programmes pushed that share down sharply. By 1980, the richest one percent took home roughly ten percent of total income — less than half the pre-Depression level.
Then the direction changed. Tax cuts, financial deregulation, the decline of unions, and the technology revolution of the 1990s and 2000s began concentrating income upward again. By 2024, the top one percent in the United States captures around 20 to 21 percent of total national income. The country has effectively spent forty years returning to a level of concentration that was last seen in the years before the stock market crash of 1929.
A global pattern with local variations
The same U-shaped curve — high inequality in the early twentieth century, a narrowing in the middle decades, a widening again from around 1980 onward — appears across most of the countries covered by the World Inequality Database. Globally, the income share of the top one percent fell from over 20 percent in the early 1900s to roughly 16 percent around 1980, before rising again to approximately 20 to 21 percent today.
Latin America stands apart as a region where the curve never really flattened. The richest one percent there have consistently held around 25 percent or more of total income throughout the entire period covered by the data — through booms, crises, and political changes of every kind. Extreme concentration at the top has been a structural feature of Latin American economies rather than a temporary condition.
Countries like the United Kingdom and Canada present a more moderate picture. Inequality is lower in absolute terms, and the reversal since 1980 has been less dramatic than in India or the United States. But even in these countries, the share going to the top one percent has been rising steadily. No wealthy country covered by the data has been entirely immune to the trend.
Why inequality fell and then rose again
The explanation for the mid-century decline is broadly agreed upon among economists. The period between roughly 1945 and 1980 was one of deliberate policy choices that constrained the accumulation of income at the very top. Marginal tax rates on the highest incomes were extremely high — in the United States they reached 90 percent in the 1950s.
Welfare programmes expanded access to healthcare, education, and housing for people in the middle and lower parts of the income distribution. Strong labour unions negotiated higher wages for workers. Financial markets were tightly regulated. These factors together pulled the income share of the rich downward.
The reversal after 1980 reflects a different set of policy choices. Tax rates on high incomes were cut significantly in most Western countries. Financial markets were deregulated. Trade opened up globally, creating enormous profits for capital owners while putting downward pressure on wages for many workers.
The technology sector created a winner-takes-most dynamic in which the founders and early shareholders of the most successful companies accumulated wealth at a pace that earlier generations would have found difficult to imagine.
These forces operated across very different political systems and at different intensities — but their direction was consistent enough to produce the same upward trend in income concentration across most of the countries in the dataset.
The question the data leaves open
Growth in an economy does not automatically mean that everyone benefits from it proportionally. The data from 1910 to 2024 makes this point with unusual clarity: an economy can grow substantially while simultaneously concentrating more and more of that growth in fewer and fewer hands. India’s economy today is orders of magnitude larger than it was in 1980. The income share of the top one percent is also three times what it was in 1980. Both things are true at the same time.
Whether the current trend continues or reverses depends on choices that governments, institutions, and societies make — about taxation, about labour rights, about the regulation of markets, and about what kind of growth they are actually trying to achieve.
The mid-twentieth century demonstrated that the concentration of income at the top is not an economic law. It is a policy outcome. It went down once. The open question is whether there is the political will to bring it down again.
Bureau Report
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