24 October 2008
analysis
Washington, DC — "Although cities in the United States of America have relatively lower levels of poverty than many other cities in the developed world, levels of income inequality ... have risen above the international alert line of 0.4. ... Major metropolitan areas, such as Atlanta, New Orleans, Washington D.C., Miami, and New York, have the highest levels of inequality in the country, similar to those of Abidjan, Nairobi, Buenos Aires, and Santiago (Gini coefficient of more than 0.50)." - State of the World's Cities Report 2009/2009
The new State of the World's Cities Report, released by UN Habitat (http://www.unhabitat.org) on October 23, touched on a wide range of issues, from the threat of coastal flooding to cities on every continent to the continued growth of slums. It also provided new statistics on urban inequality, finding wide variations both among developing countries and developed countries.
South African cities are the most unequal in the world, followed by cities in Brazil and six other Latin American countries, UN Habitat reported. Generally lower levels in inequality (under 0.3 Gini coefficient) were found in Western Europe. In Asia, Beijing ranked the most equal at 0.22, while the average in Asia was 0.39. [A Gini coefficient of 0 indicates perfect equality; Whereas a Gini coefficient of 1 indicates perfect inequality.]
Among African cities, only a few fell below the alert line of 0.4, such as Freetown with 0.32 and Dar es Salaam with 0.36. Most South African cities topped 0.7. Strikingly, as cited below, several U.S.
cities matched Abidjan, Nairobi, and Maputo at over 0.5, close to the average levels of inequality in African cities (0.54) and Latin American cities (0.55).
This AfricaFocus Bulletin includes one of the press releases about the new report from UN Habitat, and Habitat's summary regional update for Africa. For additional background, visit http://www.unhabitat.org The full report is not available on-line, but is available to order. See http://www.africafocus.org/books/isbn.php?1844076962
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American cities as unequal as African and Latin American cities according to UN-HABITAT's new State of the World's Cities Report 2008/9: Harmonious Cities
Press Release
October 23, 2008
United Nations Human Settlements Programme (UN-HABITAT) P.O. Box 30030, Nairobi 00100, Kenya E-mail: habitat.press@unhabitat.org Website: http://www.unhabitat.org
Major cities in the United States, such as Atlanta, New Orleans, Washington D.C., Miami, and New York, have the highest levels of inequality in the country, similar to those of Abidjan, Nairobi, Buenos Aires, and Santiago. At the other end of the world, Beijing is considered to be the most equal city in the world while, on average, the most egalitarian cities in the world are located in Western Europe.
These are some of the startling findings of the new UN-HABITAT report on the State of the World's Cities 2008/9: Harmonious Cities. As Ban Ki-moon the Secretary-General of the United Nations points out in his foreword to the report, "The data and analysis contained in this report are intended to improve our understanding of how cities function and what we, as a global community, can do to increase their liveability and unity."
Aimed at policymakers and planners and all those concerned with the welfare of a rapidly urbanizing world, the report breaks new ground by taking the Gini coefficient , normally used to measure inequality at the national level, and using it to measure inequality at the city level.
[The Gini coefficient is is the most widely used measure to determine the extent to which the distribution of income or consumption among individuals or households deviates from a perfectly equal distribution. A Gini coefficient of 0 indicates perfect equality; Whereas a Gini coefficient of 1 indicates perfect inequality.]
Basing their research on such economic statistics, the authors find that though the cities in the United States of America have relatively lower levels of poverty than many other cities in the developed world, their levels of income inequality are quite high, and have risen above the international alert line of 0.4.
According to the report, in Canada and the United States, one of the most important factors determining levels of inequality is race. In western New York State, for instance, nearly 40 per cent of the black, Hispanic, and mixed-race households earned less than US $15,000 in 1999, compared with 15 per cent of non-Hispanic white households. The life expectancy of African Americans in the United States is about the same as that of people living in China and some states of India, despite the fact that the United States is far richer than the other two countries.
At the global level, the report finds that, on average, the most egalitarian cities in the world are located in Western Europe. In the developed world, specifically European countries, Denmark, Finland, the Netherlands, and Slovenia, exhibit relatively low levels of inequality (Gini coefficient below 0.25, the lowest in the world). Inequalities are also low in Austria, Belgium, France, Germany, Luxemburg, Norway, Sweden, and Switzerland, where the Gini coefficients range from between 0.25 and 0.3. Low levels of inequality reflect the performance of national and regional economies in these countries and the regulatory, distributive and redistributive capacity of the national and local welfare states.
Analysing the rate of urban inequality in the developing world, the report finds that the cities of Asia are the most equal: the urban Gini coefficient of Asian cities is 0.39, slightly below the unacceptable inequality threshold of 0.4. However, there are significant income distribution differences among cities, even within the same country, which shows that national aggregates are not necessarily reflected at the local level.
For instance, Beijing, the capital of China, is the most equal city in Asia; its Gini coefficient is not only the lowest among Asian cities, but is the lowest in the world (0.22), whereas Hong Kong, the Special Administrative Region of China, has the highest Gini coefficient among all Asian cities, and a relatively high value by international standards (0.53).
The report also marshals evidence to show that India is undergoing an inequality trend somewhat similar to that of China as a result of economic liberalization and globalization. All of these changes in the occupational structure of the country are affecting levels of inequality. In 2002, for instance, the income gain of the richest 10 per cent of the population was about 4 times higher than the gain of the poorest 10 per cent.
Focusing its attention on Latin America and the Caribbean, the report finds that the Gini coefficients in urban areas and selected cities in the region are among the highest in the world. For example, in Brazil, unemployment rose from 4.3 per cent in 1990 to 12.3 per cent in 2003, and average wages of employees in the formal industrial sector fell by 4.3 per cent in 2003. Unemployment and declining wages in urban areas have polarized income distribution in urban areas. For this and other historical reasons, Brazilian cities today have the greatest disparities in income distribution in the world.
It comes as no surprise that cities in Sub-Saharan African have the highest levels of urban poverty in the world. Although rural poverty is pervasive in the region, more than 50 per cent of the urban population in the poorest countries lives below the poverty line. Though Freetown in Sierra Leone, Dire Dawa in Ethiopia and Dar es Salaam in Tanzania are among the most equal cities in sub-Saharan Africa, with Gini coefficients of 0.32, 0.39 and 0.36, respectively, the Gini coefficient in urban Kenya rose from 0.47 in the 1980s to 0.575 in the 1990s.
In South African and Namibian cities, inequalities are most pronounced and extraordinarily high, despite the dismantling of apartheid in the early 1990s. In fact, urban inequalities in these two countries are even higher than those of Latin American cities.
The average Gini coefficient for South African cities is 0.73, while that of Namibian cities is 0.62, compared to the average of 0.5 urban Latin America. Maputo, the capital of Mozambique, also stands out as a city with high levels of consumption inequality, with a Gini coefficient of 0.52.
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