Covid-19 has had massive global cross-sectoral impacts but not all have suffered equally, leading to an unequal pattern of recovery from the pandemic. Some of the health consequences of the pandemic are evident, but the relatively less obvious developmental impacts indicate a larger long-term threat to inequality. As suffering and poverty have risen, data shows an increase in another extreme: the wealth of billionaires. Rising poverty levels and wealth of billionaires indicate the inequality impacts of the pandemic.
However, in reality understanding inequality dynamics are much difficult than that. It depends greatly on what measure is being used; what pattern of GDP per capita is being assessed ? It also depends on what comparisons are being drawn; inter-country inequality or intra-country equality? Inequality stems from the extremes; the highest income groups experience disproportionately high-income growth rates. The poor have actually performed better than the middle class in terms of growth, but the top 1% have done incredibly well and that is what creates most of this disparity . The Covid-19 recession is the strangest recession in living memory; the economic impacts have been most unequal, it decimated certain segments while leaving other segments completely unscathed. The pandemic has exacerbated existing disparities in the labor market; the ability to work from home is highly correlated with education and pre-pandemic earnings, hence while daily wage earners lost jobs and incomes, the richer segment was better able to adapt to the changing job landscape.
Panelists included:
Dr. Asim Khwaja (Director, Center for International Development at the Harvard Kennedy School).
Dr. Homi Kharas (Senior Fellow, Center for Sustainable Development).
The event was moderated by Dr. Hadia Majid (Associate Professor and Director, Saida Waheed Gender Initiative at LUMS) and chaired by Dr. Ijaz Nabi (Chairperson, CDPR and Country Director, International Growth Center (IGC), Pakistan).
This webinar discussion focused on what is an appropriate lens to use when discussing income inequality and what impacts the pandemic has had on inequality within Pakistan and globally. What role governments have played in responding to the pandemic and what more can be done. Finally, the discussion attempted to identify economic and developmental opportunities that have emerged as a consequence of the pandemic.