"UNDP has defended its method by referring to quality problems related to purchasing power-adjusted
data, and with some less clear arguments telling that the dollar value of a county’s income is more relevant for studying the marginalisation of poor countries in world trade and their power in international negotiations. There are certainly problems with purchasing power-adjusted income data, and they exist for fewer countries than those that are not adjusted for price differences. In spite of this, there is widespread agreement that adjusted figures should be used when comparing international income differences. Such figures are also used by the UNDP when they construct their Human Development Index (HDI).
With a more reasonable method, the conclusion is that inequality between countries in the world has been reduced since the mid-1960s. And even with the measure used by the UNDP, inequality across countries has decreased during parts of the 1990s.
Another possible objection to our conclusion on international inequality is that income is a too limited measure of living standards, and that other indicators of welfare should be taken into account. For this reason, Section 4 examines the development of other aspects of living standards, with focus particularly on life expectancy and education. Average world life expectancy increased from 55 years in 1962 to 67 years in 1997. The improvement was considerable for a number of poor countries. Part of the improvement can be attributed to
economic growth, but a substantial part of the increase was unrelated to income changes, and could be caused by global progress in medical technology and knowledge about diseases. In the former Soviet Union and in Sub-Saharan Africa, some countries have experienced a reduction in life expectancy after 1987, due to economic decline, conflicts or AIDS. On the whole, however, the trend during 1962-97 has been towards more global equality with respect to life expectancy.
Research on inequality in countries reveals that rich countries have less inequality.
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