COVID-19 Did Not Reverse Progress in Reducing Global Inequality, New Study Finds

The COVID-19 pandemic slowed a decades-long decline in global inequality but failed to reverse the trend, according to a new study.

The findings challenge recent policy debates and calls for global wealth taxes fueled by concerns over rising disparities. Organizations such as Oxfam have argued the pandemic triggered "unprecedented inequality," but the new Human Progress Inequality Index presents a different conclusion.

The index evaluates eight specific dimensions beyond just income, including life expectancy, child survival rates, education, internet access, and political freedom. Data indicates that global inequality has dropped significantly over the last 30 years as poorer nations closed the gap with wealthy ones.

Progress stalled or slightly regressed in several areas during 2020 and 2021. Despite these setbacks, overall inequality levels remain much lower than those of the previous generation.

The study highlighted that inequality in internet access has dropped to a record low. Conversely, inequality in political freedom increased as several countries shifted toward more authoritarian rule.

A new analysis based on research from the Cato Institute, a free-market think tank, is challenging the prevailing narrative that global inequality is spiraling out of control. The report contends that the very forces often blamed for wealth disparities—globalization and free-market integration—have actually served as the primary engines for economic convergence, allowing developing nations to narrow the gap with the industrialized world over the last three decades.

Vietnam serves as a primary case study for this thesis. Since opening its markets to international trade, the country has become a global benchmark for rapid poverty reduction and sustained GDP growth. The data suggests that Hanoi’s pivot toward market-oriented policies and its deep integration into global supply chains have yielded tangible improvements in living standards. While the COVID-19 pandemic delivered a significant exogenous shock, the economic foundations established through decades of liberalization provided a level of structural resilience that prevented a total reversal of these gains.

However, the analysis identifies a troubling divergence: a "freedom gap" that widened during the pandemic. While economic indicators in many emerging markets have trended upward, political liberties have frequently regressed—a trend that has kept Vietnam under the lens of international human rights scrutiny. The report argues that long-term developmental success is ultimately dependent on the synergy between economic and political freedom. This creates a strategic friction for the Vietnamese leadership, whose current developmental model seeks to decouple high-octane market growth from traditional political liberalization.

For the Vietnamese-American community—whether in the heart of Little Saigon or running the nail salons and phở restaurants that anchor our neighborhoods—the findings of this report carry significant weight. Vietnam’s sustained economic recovery and long-term growth have a direct impact on the well-being of our families back home. As the country continues to bridge the gap with developed nations and improve its standard of living, it naturally eases the financial responsibility for those of us sending remittances. For those managing business ventures or navigating the complexities of the F2B, H-1B, or EB-5 visa processes, the report offers a reassuringly optimistic perspective: Vietnam’s economic progress is built on a resilient foundation that can withstand global volatility. This stability is a promising sign for anyone with deep-rooted familial or professional ties to the motherland.