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Economic
Development
Lecture 10
States and Markets
Inequality
Questions?
Berlin wall stood for 10,316 days, and today is 10,316 days since it is gone.
Fiscal
Subsidies
Tax Reform
Interest Rates
Exchange Rates
Trade
FDI
Privatization
Deregulation
Property Rights
Washington Consensus
Inequality
Population
Education
Health
What’s Next?
Theoretical models
vs.
Empirical evidence
Support
or Conflict?
Income
Consumption
Per Capita
Per Household
Inequality
Inequality
0
25
50
75
100
Lowest Highest
Same Average
Inequality
0
25
50
75
100
Lowest Highest
Same Average
Income
Consumption
Per Capita
Per Household
Inequality
$ Income
Consumption
More difference in Income
than Consumption
Per
Capita
Per
Household
Bob $75,000 $75,000
Bill $60,000 $100,000
Ann $40,000 married
Average $58,333 $87,500

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Economic Development Lecture 10: States, Markets, and Inequality