 Nyt ollaan 30 minuuttia tai seuraavaksi kysymyksiä ja niin edelleen. Jukka. Jukka Pirtila. Jukka Pirtila, University of Helsingin Univider. Kiitos for the great panel. I have one question and one comment. So the question is that the, how do you see the role of behavior and economics, subjective well-being for the future of measurement of poverty and inequality. And then the comment or just the advertisement is that the, when we think about the, how to finance basic income. Then we actually have a tool to examine financing needs. And that's what we call tax benefit micro simulation model. And that's something we have tried to also develop in the, in the future. So the question is that the, how do you see the role of behavioral economics developing the, in the, in the Univider here. Thank you for your interesting presentations. My question is related to universal basic income, of which a common critique that some of you did allude to, was that it will lead to, or deem, working unnecessary and people must work or hell will break loose. So, and that almost leads to the philosophical question of the link between someone's job and a person's feeling of purpose in modern day society. So I wonder how you respond to this critique of universal basic income. And more importantly, does it fit within the context of a developing country? Thank you. There were two great present, three great presentations, but there are two types of inequality which were not mentioned. One is going back to Ricardo, the share of profits, the share of factors. And I think this is absolutely critical underlying a lot of inequalities and changing in the world today. The second is inequality between us and future generations were not yet born. And I feel that this is something that must be built into everything we think about, because we are sacrificing them for us unless we think about them. So I'd like the panel to think about these two types of inequality. Anyone on this middle section? Hello, my name is Alena Tuchene from St. Petersburg, Russia. I have a question like, do you consider human rights are somehow influencing the inequalities worldwide? Thank you. Well, that's to anybody in the panel. Thanks. I got to try and answer everything. Michael's point, UBI expensive. This is kind of straw man here. Let's just take the money that you exist for a start. Let's take the money that you currently spend on, countries currently spend on subsidies to including non-poor people, subsidies on food, electricity and so on to the social protection. Put all that together and ask yourself whether you'll have more impact on the greed social goals, including poverty reduction, if you spend the same sum of money on a UBI. And then start from that onwards. And that's quite important when we take this to developing countries because this idea that UBI is too expensive, developing countries can't afford it is actually wrong, I think. I mean, I've done a lot of calculations in India where I'm persuaded that it's a serious contender in India given the cost of the alternatives. Conchita's point about perceptions of rising inequality, I think this is really crucial. I think most people think inequalities rising because they don't accept the scale independence axiom. In other words, they think about absolute differences. They don't think about relative differences. I don't know that most people think that, but all the surveys, mostly of students, alas, have said that. And that's really important because then they're talking from the ground, they're talking about a reality, a different reality to what economists are telling them what's happening. We have to take that seriously. I won't answer all the questions. What economics is there, of course. I just touched on it. UBI is the job, the center of your life. Obviously, that's going to change clearly and not just in rich countries. That's going to be a huge change going forward. Francis' point, well taken. A share of profits, of course, but as you said, underlying all of this. It's not absent. It's just not at the headline. But the second point on us versus future generations is absolutely crucial and good point. I wish I had mentioned that. Elena on human rights. Yeah, that's in the story here. Most of the ethical arguments I talked about are about rights-based, not utilitarian. Yes, only maybe the point by Francis on the short profit and labor. I think that this quite recent focus on top share of top income shares of gross income is to some extent exactly about this. And when you look at the evolution of a time of this inequality measure, then you realize that what you have behind that is really the profit-labor income story. So it might be possible to relate it more directly, but I would say that yes, indeed, in my dashboard, this is certainly one part which is present. And maybe I take this opportunity to tell Conchita that mobility was also really definitely in my dashboard. Now the problem with this kind of approach is that you definitely don't want to have 100 items. So maybe this is a work to be done by the connectivity, which is what is the minimum number of indicator that we would need in order to take into account the dimensions which we believe are really important in inequality. This is really, I think, something which would be incredibly useful. Just a comment from Swat. We had a conference to Joe, organized with Ibrahim Patel, the Ministry of Economic Development of South Africa, and he said, you know, I recognize that GDP is a flawed indicator, but I turn around and you give me 262. And that's not useful to me, he said. And he then, from his perspective, put forward seven, I think it was, or five or seven. But the point is there would be different seven in different countries, and that's an issue for us also to take on board. Is it going to be the same ten everywhere, specific, anyway. On this side, yes, we have Tony here, and then we'll come to you. Tony Addison from WIDA. So, randomized control trials. Are we at peak RCT? Thank you. Okay, Jean-Philippe Plateau from the University of Libya. So my question is reaction a bit to what Martin Ravian said, and that's in connection with something that Francois said. It is the following, that you're saying that you're concerned about inequality. I would add that I'm concerned about rising inequality because of its impact on the political system that we are in and the social fabric. And I mean the following, that if you look at the rise of populism in the world, including in the advanced countries, we see that the basic device is in education, in levels of education. And why don't we focus more, even in this panel discussion, about the problem of rising inequality in access of sufficient quality of education. A basic problem in some countries of Western Europe, including France, Germany, my own country, Belgium, et cetera, is that the average quality of schooling is diminishing. Francois has mentioned in his dashboard the indicator of PISA. But what I would like to wave is more about inequality and access to good quality of education. Because we all know that when the average quality of schooling is decreasing in countries, the rich can get access to good education, can have mentors for their children, can select a good quality education. But the average is being low. And these people are becoming more and more unqualified in a world where technology and skills are requiring more quality of education. So I think that we should have more focus on some critical dimension that causes of the rising inequality. And this appears to be a very important one. And I would privilege indicators of inequality and access to good quality education. I don't know what is your reaction about that. Hello. I have a question more about the methodology and about data. Do you think digitalization globally can bring improvements to that? Because if we have digital data and promote digitalization, for example, in developing countries, it would kind of help to obtain more accurate data. Plus it would improve education, like e-learning, e-government, also adding something like digital markets for people who can actually use it to improve the economic situation. Thank you. Thank you, Ellen Botteido-Quarante from the University of Ghana. I'm just curious to know from the panelists, to what extent do you think old age poverty is contributing to inequality and poverty generally, particularly when you take Africa and the consequences of HIV and AIDS on families in many parts. And the fact that when you talk about universal basic income, we're also looking at an apparent growing poverty amongst older people. And I'm curious to know the extent to which, if any of you know, old age poverty is a critical factor in this discussion. Thank you very much. Since the panelists have covered a huge amount of things, so it's difficult to find anything to add. Quite interesting yesterday, in the session I had with Martin, I started off with asking people in the audience how many people thought that inequality had been rising lately, and we got pretty well, Martin will confirm, that we got 90% of people in the audience think that inequality has been increasing lately, and yet the basic data certainly on the income side suggests that it's been falling. And this sort of mismatch, you wonder why, and this was actually after Martin had just given his talk and told people that inequality was going down. They still got up and voted to say that they thought it would be increasing. And I think part of this problem is when people, and I think inequality is a crucial thing here, and in some sense poverty is a side part of that. I'm not trying to diminish the impact, but how can we really resolve this? And I think partly it's because when people talk about inequality, they focus on different things. Some people think about just how much the poorer people are falling behind, that's one aspect of inequality. Or they focus on how much the sort of rich groups are going, drawing out ahead. I think if you focus on different parts of that, you can get a different view about what is happening to inequality. A second thing is I think perhaps over time our reference group has been changing. In the past when people were talked about inequality, they had perhaps a local reference group, friends, neighbors, their relations and so on. We then perhaps expanded to some sort of national idea, but I think perhaps now we have a bigger perspective on the group that we're comparing against and judging. And that actually may at least be part of the explanation. But the other thing that really worries me, and I think slightly touched upon by the previous point being raised here, is why we are concerned about inequality. I have always really think that wealth inequality is somehow more fundamental than income inequality. The reason is that it's not just affecting your standard of living, but it also gives you control of certain sorts of things. We haven't had this discussion, but I think this is when we get down to it, we are concerned about this. And lately let's just think about what's been happening with inequality. What's the relationship between inequality and the way that it impacts on people? First of all, in the media in the world, it seems now that all the media seems to be growingly owned by rich people. And I don't know, anyone's done a study of this, but if you did track over time, it looks to me that more and more of the information that people get is coming to them via someone who is a rich person. And then you get the problem, particularly in the states, where the whole political system has been taken over by richer groups, that somehow it is now, how many people can run for president now that aren't billionaires? This was not true in the past and is progressively true, and it's not just in the US. It is throughout the world. And then there's also the issue, I think about intergenerational issues. The more that wealth becomes important, the more it really is quite easy for this wealth to be transferred between generations, and so you get this break really between, so that the whole life-chance is now, it is being more and more, I suspect, it is becoming, there's more divergence really between future generations and the link to the current generation, and that, again, is part of the inequality that people are responding to. So when they say that they think inequality is going up, I think it's perhaps taking into account these sorts of things rather than just looking at the data that seemed to be pointing in the opposite direction. So three things. First of all, if you age decompose either $1.90 a day or global MPI, and look at the group that is 60 plus, so the AG Compositions in 2016 by Newhouse or the global MPI, which we did last year, you find that all poverty for people 60 plus is one-third the level of child poverty for $1.90 a day and about one-half for MPI, so it's definitely lower, but not necessarily very different from adult poverty. But partly that's because these are household measures, and in some cases older people live in shared households, and in some cases it's older people living alone in their households, where there are both issues of nonrepresentativeness because the surveys don't cover them and also issues that other dimensions become important. The health cut-offs are different. There is no WHO growth standard of BMI for people 70 plus, they lose bone density, you can't use that measure, and also there's aspects of loneliness. So I think there are a lot of issues and the new group on data for aging populations I think should be very important in that regard. And I would just finally also wish to say that I'm not sure all of us agree that inequality is the only priority. So I think that just to put a marker on the map, maybe for income poverty it's no longer a problem, but if you look at the 30 sub-Saharan African countries where we looked at changes over time, 30 of them had statistically significant reductions, but in 18 of them the number of poor people went up because of population growth being outpacing reduction of poverty. So I think perhaps not all types of poverty are off the map in terms of requiring research attention. Yes, two points. First on Jean-Fierry's point about education. I think we all agree with the fact that this is something which is extremely important. As a matter of fact, the reason why it didn't come yesterday was because I was attending an event where the Macron, the French president was presenting his anti-poverty plan and it turns out that the most important pillar is really on education and early childhood. And I think this really fits well what Jean-Philippe said. But the point is that I agree with the fact that it is not only when I referred to PISA, I didn't refer to the average score of PISA and the international ranking of PISA. We don't care about this. What we care really about is what is the kind of inequality that we have behind PISA. And you have all the data in this data set. You have all the variables that would allow you to see the way in which the result of kids depend on the family background. But more than that, it's not only the cognitive part of the thing, but there is also information on the non-cognitive thing, which is quite important. Here, I believe this is central and this is the reason why I put that in my dashboard. On the turning point about wealth inequality, I also put wealth inequality on my dashboard and I agree with you the fact that this is reflecting control of political control, which is extremely important, not only in the US. We just started with some colleagues' work on Benin and this is another country where you have a billionaire who is running the country and who is running definitely the country to his advantage. So it is something really very important. Intergenerational issue also important, but it is, again, one dimension of inequality. This does not say very much about poverty, about inequality of living standards today. So this is one dimension that has to be taken into account, but it is not the only one. Tony, on RCT, have we reached the peak? I mean, this is relevant here because without evaluation we're not going to know if it works or not. Have we reached the peak? Definitely not. It's going to continue. It's really bad news for our evidence-based policymaking going forward. We've got a massive distortion, in my view, with the popularity of randomized control trials. I'm all in favor of putting RCTs on the menu for evaluation, but it shouldn't be the only thing you do. I mean, they're not, but the tendency to rely heavily on them and to exclude work that doesn't use randomized assignment is a real worry. And I think that's one of the attractions of Wider's work program, I think, has been that it hasn't fallen for that temptation. It's looked at a broad set of development questions. It looks at the questions and starts with the questions and then figures out what kind of methodology is appropriate, rather than starting with a particular methodology and finding what questions you can answer with it. And that's a real problem going forward. Intellectually, I think, we've reached the peak, but when you look at the number of people working on this and the number of students working on this and going forward, it's going to be even bigger. I won't add anything. I think, for instance, I covered a couple of points. I mean, yes, education is hugely important. I fold that under the inequality of opportunity stuff, but I didn't mention it explicitly. The point about digital data, I think going forward, one thing we're going to be looking at clearly is data sets where we're large, the bias variance trade-offs that we're used to in the past, this relates also to the RCT story. We're not going to be looking at statistics which we rely upon largely because we think they're unbiased. We're also going to be looking at statistics which we think are reliable because of low variance. That's changing already and we're seeing that in a number of areas and it's going to be important going forward. The only other point I'd add on old age poverty is particular groups, yes, like widows and who aren't necessarily old, particularly in sub-Saharan Africa because of the age difference of marriage. There are particular groups where this is a real concern. Old age per se, I don't see it as quite the issue, but particular groups interacting with age where I think there's a big concern. The only thing I'd add to what Tony said, Tony Shorrocks, I think a lot of it, the misperception, the reason why 90% yesterday said inequality is increasing is I think again most people think about inequality in terms of absolute differences, not relative differences. That's the first order thing. I think there are other aspects, but that's clear to me now and it's not clear. We don't do that in our measurements, but it's there. Thank you. There's also a point on RCTs raised by Tony Edison. I think one risk that we have is that it somehow redirected the attention basically to targeted policies and that we lost sight a bit of more macro reforms. I think these things have to come a bit more back on the agenda in particular also discussed industrialization. I mean, that's clearly something that we won't solve with RCTs. Now the second point because if we discuss inequality and poverty, many of these RCTs would have more utility for this kind of discussion if they made more effort to work out the general equilibrium effect, so not just focusing on the impacts of the direct beneficiaries, but to sort out so what does it mean for the economy as a whole, what are these spillovers, what happens if we scale up these programs. I think if RCTs can integrate more of these kind of problems, then again it might also be more useful for lots of the questions that we addressed here. And just a short point on the thing raised by Jean-Philippe Plateau on the quality of education. I think one problem is of course that for the very poor countries we do not have a lot of information about the quality of education. We know that's a problem, but most of the surveys are still quite poor. I mean, we have some very special surveys where we have information, but then again we don't have the link with all the other socio-economic information. So LSMS or maybe DHS would have to integrate this more to analyze this in more depth and then to work out what are the effects on inequality dynamics. Thank you. Hi, I'm Tan Tsangretang from July Lungan University in Bangkok. I would like to hear the speakers view on the role of norms or culture or informal mechanism in mitigating inequality. For this I mean about charity, for example, citizens in some countries just actively participate in charity donations and that could be a substitute for formal transfer from the government. So I just would like to hear whether there's research work on this and how it can interact with the former redistribution program. I'm from Fudan University, China. I have a very simple, I guess technical, might be important question. That is when we measure global inequality, it of course consists of two components. At the moment really we attach weights equally to the within country differences and the country's difference to the global mean. Is that right? Or should we actually weight the two components differently? Because to me it seems inequality closer to one person is probably a little bit more important than inequality far remote. Thank you. Two small points. One is on Tony Shoroks. Inequality is rising or not rising depending from the beginning and the last point. If you compare within country inequality between 1980 and 2015, inequality has risen a lot. There is no question about that. Now if you compare what happened between 2000 and 2015, then you have the Latin American story. There are perhaps half of the African countries which also experience falling inequality, a few countries in the Southeast Asia as well. So if you compare the time trend, you have to specify the beginning and the end of the trend. And I think that the argument is the poor are getting poorer and the richer are getting richer first to 1980 to 2015. On that there is no question. Now a second point is more on policy. I think that I'm not so sure I agree with Conchita about the idea of guaranteed minimum income. And I think that in Italy, for instance, this is one of the main proposals of the current government. I think that what is more important is to have a guaranteed job, particularly for the people who are part of the labor force. So the same resources that you can use for providing straight transfers, I think they can be used for other things. One is reducing the length of the working week. I mean Keynes basically argued that in 1930, that in his famous paper on the well-being of our grandchildren, is basically that people at the end of this last century, 70 years later would have worked 15, 20 hours. Now that was a little bit of an overshot, but people, the length of the working week is equivalent by 60 hours to about 35 hours, at least in the West. And if I'm not wrong, in Germany last year, about almost half a million people started working 28 hours a week. So one way to fix the problem is to use these resources to further reduce the length of the working week. So a rationing labor. And industry is against, but then they will come to terms. And the other way is to say, well, okay, we'll use these subsidies to reduce labor costs, for instance, rather than providing straight transfer, because you do create moral hazard. Thank you. I probably if I can read better what Martin said, this basic income is more for the developing countries than I totally am not in favor of the policies of the current government in our country. So don't take me wrong on that. And the reforms you mentioned about the reduction in the working time, they're pretty costly, like the one in France that reduced an hour of the week. The government obtained that just reducing the costs for the firms on the labor, but it was really costly. So I'm not sure we can afford that too. And my views on the linking, the linking what you get from the job was more linked to the digital revolution, the automation, the robotization that will change the labor market. So we will end up changing jobs, not having always a job. And I was thinking of a way to give something to everybody delinked from that. Yes, I'm coming from a country where we actually went from 40 hours a week to 35 hours a week. And this was really very, because of that we had really a very difficult time. It is true that as Kanchita said, this was only possible because there was a huge subsidy made by the government to the employers to compensate for that. Because of course, if you have people, do you agree to have to work 35 hours paid 35? Instead of 40 hours paid 40, they won't agree. But if you tell them you will have 35 hours paid 40, then of course, and this is what we did. And then there was to head up, it was necessary to subsidize the firm. And this was a very, very difficult period, now we are in this new steady state. I think that people who are asking to come back to the 40 hours week have lost their case. But this is to say it is not something that easy. And if you look at the number of jobs which were created because of that, it is very, very limited. It is a few hundred thousand, but it has nothing to do with the size of an employment in France. Now a point that I wanted to mention about your remarks, Andrea, is about the basic income. I think you're right in the sense that, again, this is the experience of developed countries and I believe that this would extend to developing countries. But in developed countries, we have something like the universal basic income. When this was introduced, people said, okay, fine. We have an income to survive on if we don't have any job, if we have been unemployed for three years, et cetera. But we are not satisfied in the sense that we are still feeling excluded from the society. And social exclusion is something, I believe, equally important as the lack of income. And so I'm not sure that this is really the whole solution and I would tend to agree with you that creating jobs is certainly much more important than if it is possible, than simply subsidizing people who don't have a job. And on your other point about the trends in inequality in countries, there is something which is quite interesting that when you look at the increase in inequality in most European countries, I'm not referring to the US, which is to some extent an exception, there is no trend in most European countries. The only countries with a trend are Sweden, Denmark, basically because there is a progressive going back on redistribution in those countries. So the redistribution system is becoming less progressive and because of that inequality is increasing. In other countries, what you observe is that there is one point in time where there was a big increase, such as England, such as the United Kingdom. In Italy, the time where they stopped with a centralized bargaining in Germany when they started with the arts labour market reforms. In all those cases, you have for four or five years an increase in inequality and then the whole curve is flattening. This is a pattern that you have in many, many countries. Now, this does not mean that there will not be another increase in inequality in the coming years, maybe, but we are not in the same situation as in the US where you truly have a trend, the slope of which is changing over time, but there is definitely a continuous trend. And I think this is something important to keep in mind. I think one of the interests in UBI here is also that it's a double benefit because it addresses poverty and it addresses inequality in the same intervention and it could be interesting to think in other spaces of inequality of education and inequality of healthcare that if you think of the distributions of inequality of those, they are much more shortened perhaps than an income distribution. And so, in that sense, interventions at the bottom of the distribution will perhaps have, again, both kinds of effects of addressing deprivations but also reducing inequality in non-monetary spaces. Okay, just things that have been covered on the question about charity norms and so on. Here I think probably one of the greatest philosophers all time, Emmanuel Kant, had the answer 200 years ago, more than 200 years ago, that the charity, private charity, is not a respectful relationship for poor people. It is not something we should rely on heavily. It can, we don't, you can't rule it out but there is an important redistributive role for the state and more anonymous and more respectful relationship between poor people and rich people and I wouldn't want to backtrack on that. Although I think with technology there are going to be some changes in how respectful, disrespectful charity can be. We can go into that. The point about within and between decompositions fully agreed, I think that's what I was getting at, that the between group component of inequality is more important than the normal measures suggest, as others have said before me. I'm nothing more further out on the comments on Andrea. It's terrific, Andrea can make these comments. He missed all the presentations. He came in late, missed them all and he still has good comments. It's really great. He agrees with me. Finally, just on Francois' point, I really think it's not too far distant future. We will never be saying things like what Francois just said that UBI is subsidizing people who don't have a job. That mentality, my dear friend Francois, is going to change. This concludes by saying that for the incoming director of wider Kunal Sen, you can see that there are plenty of issues, Kunal, for you to be carrying on. Just to pick up a few, not all of them, is where does the balance of attention go? Poverty or inequality is one type of issue that has come up. Which inequality, and which of the many inequalities, including the 10 on Francois' dashboard, but also there may be many others? Is it perceived inequality or measured inequality as we measure it in our conventional things? Those are issues that have come up. Finally, on the policy front, you can see that the UBI discussion is already well engaged. Perhaps this wider is a platform on which that discussion can proceed in a safe and respectful way. With that, let us thank our panelists for a great session.