Chakraborty, Shankha; Lahiri, Amartya - 2014
inefficiencies, have both been suggested as important factors in accounting for the cross-country per capita income distribution. We … frictions account for less than 2% of the cross-country variation in relative income. Even accounting for mismeasurement …, financial frictions can typically explain less than 5% of the income gap between the five richest and the five poorest countries …
