# **I. Introduction**

This paper ignores national boundaries and studies the Sub-Saharan-Africa-wide distribution of consumption expenditure among individuals. By combining household survey data from as many African countries as possible (accounting for around three-quarters of the regional population), we can put all Africans on the same scale of consumption expenditure, regardless of their country of residence.<sup>2</sup> Inequality and other distributional characteristics are typically measured at the countrylevel (e.g. for a recent review of the evidence on Sub-Saharan Africa, see Beegle et al., 2016). This paper offers a complementary view and puts the disparities that exist within African countries into context with the disparities that exist within the region as a whole.

Our analysis is similar to studies of the global income distribution (Milanovic, 2005, Anand and Segal, 2015; Ravallion, 2014a) and we draw heavily on the analysis by Lakner and Milanovic (2015). Our analysis is perhaps best seen as referring to a sub-region of the global distribution. According to Milanovic (2005), there are three concepts of global inequality: (1) the inequality in per capita incomes between countries in the world, which is relevant to studies of income convergence across countries; (2) population-weighted international inequality, which assigns everyone the per capita income of their country of residence; and (3) interpersonal inequality, where everyone is assigned their own income. In this paper, we study the third concept as applied to Sub-Saharan Africa, i.e. the inequality in consumption expenditure among all people living in Sub-Saharan Africa. Implicit in our analysis is an African-wide social welfare function which treats persons irrespective of their country of residence. In the global context, this is referred to as a cosmopolitan social welfare function (Atkinson and Brandolini, 2010).<sup>3</sup> One might also have an instrumental concern for regional interpersonal inequality if extreme regional inequality contributes to conflict or migration.

The analysis in this paper is based on a database of national household surveys from Sub-Saharan Africa maintained by the World Bank, over the period 1993 to 2008. Our welfare measure is consumption expenditure per capita as measured in household surveys, expressed in 2011 PPP USD, although the results are robust to using 2005 purchasing power parity (PPP) exchange rates. While our database of household surveys has a good coverage of Africa as a whole (representing three-quarters of the regional population), the coverage of fragile countries remains low. Hence our results are probably a lower bound on African inequality. Another reason for why our estimates are likely to be a lower bound is that we use consumption expenditure surveys which most likely underestimate consumption at the top of the distribution.<sup>4</sup>

> 2 Throughout this paper, we use “Africa” and “Sub-Saharan Africa” interchangeably, as in Beegle et al. (2016). 3 A large literature in philosophy discusses the cosmopolitan view of the world and issues of global justice more broadly (e.g. Pogge, 2002; Singer, 2002; Nagel, 2005).

> 4 Furthermore, inequality in consumption expenditure tends to be lower than inequality in income, e.g. Li et al. (1998) find a difference of 6.6pp for the Gini index. Considering the regional distribution of _wealth_ (as opposed to consumption expenditure), it can be shown that the ten wealthiest individuals have as much wealth as the bottom half of the African continent (in this case including both Sub-Saharan and North Africa) (Lakner, 2015). However, the imputations used in the wealth data might underestimate wealth holdings at the bottom (see footnote 5 of Lakner, 2015), thus suffering from the opposite problem than the African consumption distribution in the present paper.

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