inequality experienced by Mexico after the 1985 trade and financial liberalization. To do so, the paper uses data from Mexican … counterfactual methodology to measure the effects on inequality of changes in labor force participation, unemployment, structure of …

quality. The theoretical model suggests that income inequality, coupled with political bias in favor of the rich, decreases … latter is to decrease it - with resulting ambiguous implications for economic growth. Testing these predictions empirically … in a panel of countries, the paper finds that inequality has a negative effect on both institutional quality and …