A surreal illustration of income inequality in Thailand, showing a divide between a privileged few and a struggling majority.

Thailand's Income Inequality: Why Economic Growth Isn't Trickling Down

Kai Mendoza in Business & Economy August 2025 • 5 min read.

"A deep dive into Thailand's persistent income distribution challenges and why conventional solutions have fallen short."

Thailand has achieved remarkable progress in poverty reduction, yet income inequality continues to cast a shadow over the nation's economic success. While the country has made significant strides in various aspects of socio-economic development, a considerable income gap persists, where a small portion of the population controls a disproportionately large share of the overall wealth. This imbalance poses a significant challenge to inclusive and sustainable development.

Recent data from the National Economic and Social Development Council (NESDC) highlights the severity of this issue. In 2021, the top 20% of earners accounted for 50% of the total income share, leaving the remaining 80% to split the other half. Furthermore, the top 10% possess 67% of the income of the top two deciles, leaving only 33% for the next 10%, underlining an even more skewed distribution at the upper end of the spectrum. Despite advances in occupational and income security, the NESDC notes that income distribution progress has been slow, with patterns remaining largely unchanged over the past three decades.

The persistence of income inequality necessitates a thorough understanding of its underlying causes and potential solutions. Research suggests that income distribution often follows a pattern of scale invariance or self-similarity, implying that its fundamental structure remains consistent regardless of economic scale. While this concept isn't mainstream in economics, it suggests that conventional redistributive policies may not suffice. This article dives into this challenge, exploring innovative perspectives and policy recommendations for fostering inclusive economic growth in Thailand.

Is Thailand's Income Distribution Truly Scale-Invariant?

A surreal illustration of income inequality in Thailand, showing a divide between a privileged few and a struggling majority.

The concept of scale invariance suggests that the essential characteristics of income distribution remain unchanged over time, regardless of economic shifts. Many studies in complexity economics and econophysics demonstrate this principle across various distributions. A distribution is scale-invariant if its structural and dynamic properties remain consistent across different scales. While scale invariance isn't common in economics, empirical evidence dates back to Vilfredo Pareto, who observed that income distribution varies little across space and time, producing similar results across different populations and eras.

To examine scale invariance, a common method is to see if income distribution follows a specific pattern like power law, gamma, or log-normal distributions. If income data fits one of these distributions, it indicates scale invariance. Some researchers believe that income distribution's upper tail follows a power law, while the lower part can be fitted by power law, gamma, or log-normal distributions. Given that there is not an agreement on choice of statistical distributions, a Kolmogorov-Smirnov test (K-S test) is employed. The test indicates income distribution in Thailand is statistically scale-invariant or self-similar with p-values ranging between 0.988 and 1.000.

Scale invariance means that traditional economic models and policies may not fully address the root causes of inequality.
Recognizing scale invariance is a first step towards designing more effective and targeted interventions.
If income distribution in Thailand is scale-invariant, it implies the same underlying rules and dynamics are at play regardless of economic scale.

These studies confirm that the patterns of income distribution have not significantly changed over the past three decades. They also reinforce existing evidence of scale invariance or self-similarity in income and wealth distributions from other studies. The K-S test used is relatively simple, doesn't require a priori specifications of income data distribution, and still yields similar findings.

Reimagining Policies for a More Equitable Thailand

Thailand's persistent income inequality calls for innovative policy approaches. The concept of scale invariance is underexplored by policymakers and the conventional development policies conducted during the past three decades had not been quite effective in changing the pattern of income distribution in Thailand. This phenomenon suggests that generic features and principles of income distribution are independent of economic dynamics. By understanding income distribution as a state, similar to water being liquid, policy measures can act as changes to the environment. Much like changing water from liquid to gas requires reaching a certain temperature, it requires policies and measures that can change the detailed dynamics and/or specific characteristics of the economic system as specified above which in turn cause the phase transition of income distribution. The challenge lies in identifying the catalysts for this 'phase transition' in income distribution, and remains an area for future exploration.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: 10.1371/journal.pone.0288265,

Title: Income Distribution In Thailand Is Scale-Invariant

Subject: econ.gn physics.app-ph q-fin.ec stat.ap

Authors: Thitithep Sitthiyot, Kanyarat Holasut

Published: 01-02-2024

Everything You Need To Know

What is the main problem related to economic development in Thailand, as discussed in this context?

The central issue is persistent income inequality, despite decades of economic development in Thailand. While there has been progress in poverty reduction and socio-economic development, a significant income gap remains, with a small portion of the population controlling a disproportionately large share of the overall wealth. This imbalance challenges inclusive and sustainable development, as evidenced by data from the National Economic and Social Development Council (NESDC).

What does the concept of "scale invariance" mean in the context of Thailand's income distribution?

Scale invariance suggests that the fundamental structure of income distribution in Thailand remains consistent regardless of economic shifts or scale. It implies that the underlying rules and dynamics governing income distribution are the same, regardless of the overall size of the economy. Empirical evidence, supported by the Kolmogorov-Smirnov test (K-S test), indicates that Thailand's income distribution exhibits scale invariance or self-similarity, with patterns largely unchanged over the past three decades.

How does scale invariance affect the effectiveness of traditional economic policies in Thailand?

If income distribution in Thailand is scale-invariant, it suggests that conventional redistributive policies may not fully address the root causes of inequality. Traditional economic models and policies, which often assume that economic dynamics change with scale, might prove less effective. The understanding of scale invariance is a first step towards designing more effective and targeted interventions. The article suggests that recognizing this could lead to different policy approaches, because if income distribution is scale-invariant, it implies the same underlying rules and dynamics are at play regardless of economic scale.

What specific data points illustrate the extent of income inequality in Thailand, as mentioned?

Recent data from the National Economic and Social Development Council (NESDC) reveals that in 2021, the top 20% of earners in Thailand accounted for 50% of the total income share. This leaves the remaining 80% to split the other half. Furthermore, the top 10% possess 67% of the income of the top two deciles, leaving only 33% for the next 10%, highlighting the skewed distribution at the higher end of the income spectrum. These figures underscore the severity of the income gap and the challenges it presents for inclusive development.

How can policymakers potentially address income inequality in Thailand, considering the concept of scale invariance?

Policymakers need innovative approaches that consider the concept of scale invariance. The article suggests that conventional development policies conducted during the past three decades have not been effective in changing the pattern of income distribution in Thailand. Understanding income distribution as a state, similar to water being liquid, means that policy measures can act as changes to the environment. The challenge lies in identifying the catalysts for this 'phase transition' in income distribution, and it remains an area for future exploration. This could involve targeted interventions that address the specific dynamics of the economic system, potentially leading to a shift in income distribution patterns.