Dominance of the Top 10 Percent

Bharat Dogra

One of the measures of inequalities that has been often used in the extent to which the top ten percent of the citizens of any country dominate its economy. In India the top 10 percent of the population amount in overall numbers to about 80 million (8 crore) adult individuals in term of 2014 data. To what extent do the top ten percent of the citizens (in terms of their income) have a dominant role in the economy in India?

            In this context some data given in the widely discussed paper titled 'Indian Income Inequality - From British Raj to Billionaire Raj' is very relevant. This paper has been written by Thomas Piketty and Lucas Chancel of the Paris School of Economics.

            The available data tells us that between 1980 and 2014 the income of the top 10 percent of the adult population increased by 394 per cent. The top 10 percent of population (adult citizens)  managed to capture or corner 66% of the increase of national income during this period, leaving merely 34% share for the remaining 90 percent section of the population.

            Thus while the top 10 percent already occupied a prominent place in the economy of the country around 1980 or so, from then to around 2014 this section consolidated its portions more rapidly by capturing 66 per cent of the growth during the next 34 years or so. Since it is likely that this process of consolidation has continued unabated or probably accelerated further the top 10 per cent are likely to be in a very dominant position in the economy today.

            With a size of around 80 million and with their dominant position in economy as well as in political decision-making, the top 10 per cent are likely to push forward an elite dominated, elite-driven sub-economy. (Within a larger national economy of many-sided deprivations) that becomes increasingly alienated from the concerns of the other 90 per cent and more particularly the bottom 50 per cent. This will be very harmful for all concerns of justice and equality, for broad-based progress as well as for democracy. Therefore, high priority should be accorded to correct trends of growing inequality and domination by a relatively small  section of population.

Nov 10, 2017

Bharat Dogra

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