Observations about Inequality in Thailand

Sirikanya Tansakun

Thailand Future Foundation

For KEPA Seminar on

SUSTAINABLE DEVELOPMENT GOALS AND INEQUALITY

ENGAGE ANALYSE INFORM

“Even though the Thai economy has established an impressive

record of economic growth, the income distribution is quite

uneven and a geographic imbalance still exists. The incomes in

the urban areas are generally about twice higher than those in

the rural communities, and the average income in the

metropolitan area of Bangkok is more than triple those in

villages in the Northeast. This disparity raises the potential

danger not only of an economic nature but of political

subversion as well.”

- National Economic and Social Development Board

“Even though the Thai economy has established an

impressive record of economic growth, the income

distribution is quite uneven and a geographic imbalance

still exists. The incomes in the urban areas are generally

about twice higher than those in the rural communities,

and the average income in the metropolitan area of

Bangkok is more than triple those in villages in the

Northeast. This disparity raises the potential danger not

only of an economic nature but of political subversion as

well.”

- National Economic and Social Development Board, “Evaluation of the

First Six-Year Plan 1961-1966”

1,429 4,369

28,808

89,739

2529 2554

Source: Household Socio-economic Survey, National Statistical Office (1986 and 2013)

Income gap between the richest 10% and the poorest 10% in 1986 and 2013

Unit: Baht/Month (Real term using 2011 as base year)

The Richest 10%

The Poorest 10%

20 21 Income gap (Times)

1986 2013

Inequality in Thailand has got worse over the past 3 decades.

1

1 2 3 4 5 6 8 9 10 1 7

village

The richest 10% Average income = 90,000฿/month

village

฿

The poorest 10% Average income 4,400฿/month

฿

55% of household heads

are elderly

28% of household heads

are farmers

41% of household heads

are professionals

22% of household heads

own business

฿ ฿ ฿ ฿ ฿ ฿ ฿

The poorest are the elderly, not farmers. 2

0.00.10.20.30.40.50.60.70.80.91.0

0-1K

10K-

11K

20K-

21K

30K-

31K

40K-

41K

50K-

51K

60K-

61K

70K-

71K

80K-

81K

90K-

91K

100K

-101

K

110K

-111

K

120K

-121

K

130K

-131

K

140K

-141

K

150K

-151

K

160K

-161

K

170K

-171

K

180K

-181

K

190K

-191

K

>200

K

Household income per month (Baht)

Median household income = 16,000฿

Average household income = 24,000฿

Income most households earn = 8,000 - 9,000฿

No

. of

ho

use

ho

lds

(mil

.)

Source: Household socio-economic survey 2013, National Statistical Office, TFF Analysis

Distribution of real household income 2013

Half of Thai households still earn less than 16,000 baht per month

3

63,000

368

Official survey data underestimates incomes and wealth of the very richest.

Average net worth of Forbes’s 50 billionaires

Net worth of

the richest household from survey data

Source: Household socio-economic survey, National Statistical Office in 2013, www.forbes.com

4

Average net worth of Forbes's 50 billionaires and the richest household from survey data

Unit: Mil. Baht

Rank Countries

# 11 Japan

# 34 Vietnam

# 116 South Korea

# 159 Malaysia # 161 Venezuela # 162 Thailand # 163 Indonesia

# 173 Russia

0

Wealth Inequality Ranking (out of 174 countries)

Source: Global Wealth Databook 2013

Thailand ranks near bottom on wealth inequality. 5

37% Income 2%

56%

60%

93%

Net worth

Land

Deposits

0.07%

<0

(Debts)

0.005%

Bottom 10% Top 10% Types of income/asset

Share of Income and Asset

Source: Household socio-economic survey in 2013, www.forbes.com, Duangmanee (2013)

Wealth concentration., Bank of Thailand

Thailand ranks near bottom on wealth inequality. 5

Total net worth

2 million

Households

Source: Office of the National Anti-Corruption Commission, Global Wealth Databook2011,

TFF Analysis

Members of Parliament

500 Families

The average wealth of MPs is higher than that of 99.999% of Thai households. 6

Total net worth

1.6 million

Households

Source: Office of the National Anti-Corruption Commission, Socio-economic

Survey 2013, TFF Analysis

Members of National Legislative Assembly

214 Families

The average wealth of NLAs is higher than that of 99.99% of Thai households. 6

2x More likely that the children from the richest 20% households to pass PISA math test than those from the poorest 20% households.

4x More likely that the children from the richest 20% households to get into college than those from the poorest 20% households.

Source: Household socio-economic survey, National Statistical Office in 2013, Program of International Student Assessment 2013, TFF Analysis

7 There is also inequality in access to quality health and education.

“Persistent inequality in opportunity is much more difficult to accept, and can lead to a sense of injustice, resentment and conflict. People can accept losing the race, but not being prevented from competing. Such a focus on addressing inequality in opportunity requires policies to improve the access and quality of public services, especially education.”