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December 29, 2005

On the unequal inequality of poor communities

Important differences exist between communities with respect to their needs, capacities, and circumstances. As central governments are not able to discern these differences fully, they seek to achieve their policy objectives by relying on decentralized mechanisms that use local information. However, household and individual characteristics within communities can also vary substantially. A growing theoretical literature suggests that inequality within communities can influence policy outcomes, and that this influence could be harmful or helpful, depending on the circumstances.

Posted by Gary Holden at December 29, 2005 10:29 AM