This article is part of a series in which OECD experts and thought leaders – from around the world and all parts of society – address the COVID-19 crisis, discussing and developing solutions now and for the future.
To keep updated on all of the OECD's work supporting the fight against COVID-19, visit our Digital Content Hub.
The COVID-19 pandemic is threatening the health, livelihoods and well-being of billions of people across the planet. The public and private response to the pandemic has been unprecedented, requiring substantial individual and collective efforts. The pandemic has led to the most severe economic downturn since the Great Depression and its effects will be long lasting, with a projected global GDP decline of up to 7.6% this year (see latest OECD Economic Outlook). But the COVID-19 pandemic is not taking place in a vacuum. Over the past three decades, inequalities have risen in areas that are crucial to people’s lives and well-being. This has translated into economic divides in terms of income and wealth, but also social and territorial divides in terms of opportunities and exposure to risks. Combined, these trends have led to a widespread sense of vulnerability that affects a vast majority of citizens, including among the middle class. For instance, 40% of middle-income households are considered “financially insecure” in the sense that their financial assets would not allow them to absorb unexpected expenses or a sudden loss of income; and nearly 50% of middle-income households surveyed in 2016 reported difficulties in “making ends meet” (see OECD report Under Pressure: The Squeezed Middle Class).
Measures taken today, particularly those designed to fuel the recovery, will need to take account of these broader trends if they are to command wide support and build on the shared sense of purpose experienced by citizens in the face of the pandemic. People’s willingness to support policy is shaped in part by their perception of where they stand in society and what their prospects are.
Where State and Market Lie: Or, how do institutions in a complex modern economy work together for the common good by Diane Coyle, Bennett Professor of Public Policy, University of Cambridge
The OECD has upgraded its Compare Your Income web tool to help align recovery strategies with citizens’ perceptions and priorities.
The OECD has a long track record of measuring and monitoring inequalities, but much less is known about people’s perceptions of the distribution of economic resources in their country. To contribute to better understanding people’s multifaceted response to rising inequality, in 2015 the OECD launched a web-based interactive tool called Compare your Income (CYI). It allows users to explore statistics on income inequality by seeing where they stand in the distribution and testing whether their perceptions are in line with the actual situation in their country. It also gives them an opportunity to express and share their views on how they would distribute the income in their country. CYI is available in eight languages, fully confidential and anonymised, and has attracted over 2 million users since its launch.
This year, the OECD has introduced a timely new module to explore how people’s perceptions of inequality impact their willingness to support redistribution and what areas they would prioritise for public spending. CYI is ideal for monitoring how people’s perceptions and preferences evolve over time, notably in reaction to unexpected and disruptive events such as the COVID-19 pandemic.
Read the OECD Policy Brief Supporting the financial resilience of citizens throughout the COVID-19 crisis and more key policy responses
In a context where the COVID-19 pandemic will demand unprecedented policy responses, CYI will shed light on people’s perceptions of tax fairness and provide insight into their preferences regarding areas for public spending; with direct relevance to budgetary decisions and fiscal packages. The new data will also allow the OECD to explore important questions of broad societal interest, such as how to share the costs and efforts of recovery more fairly; and how to avoid overburdening populations that are already under pressure or giving the impression that, “the same people always end up paying”.
What's your perception of income inequality? In only a few clicks, see where you stand in your country's income distribution, share your views on how income in your country should be distributed and have your say on what areas should be prioritised for public spending
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