Market Liberalization and Income Distribution: The Experience of the 1980s

  • Albert Berry
  • Frances Stewart


The decade of the 1980s saw a major change in economic and social policy in both developed and developing countries — one that may well be regarded as a seachange by future economic historians. For most developed countries, there was a move from Keynesian towards monetarist macroeconomic policies; from welfare state provision from cradle to grave towards pay-as-you-go social services; from the public provision of basic services, such as water and electricity, at frequently subsidized prices, towards privatized provision at ‘economic’ prices; from industrial interventionism and labour protection to laisser-faire; and from tax systems whose major purpose was to correct inequalities towards systems mainly intended to promote incentives and economic efficiency. In many respects, the package of changes, and the change in the prevalent economic and social paradigms which underlay them, amounted to a retreat to the philosophy and policies of the 1930s.


Income Distribution Real Exchange Rate Real Wage Gini Coefficient Trade Liberalization 
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© The North-South Institute 1997

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  • Albert Berry
  • Frances Stewart

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