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This thesis is comprised of three essays studying the high and low wage ends of the labour market. Historically there has been little theoretical analysis of low-paid, non-standard work and so in the first and third essays I develop theoretical models incorporating two types of non-standard work: casual and part-time. The second, co-authored, essay is empirical, using data on football players to study the wage determination of very highly paid workers. In the first essay I study low wage, casual jobs. These jobs provide flexibility for firms to change the size of their workforce cheaply and quickly and for workers to choose whether to supply labour in every period. This flexibility comes at the expense of certainty for both firms and workers. I develop a search and matching model incorporating casual jobs, which I use to evaluate the effect of labour market policies on aggregate outcomes. The equilibrium of the model features the concentration of casual jobs at the bottom of the wage distribution. I find that a ban on casual jobs increases unemployment, but that the average wage of those employed actually increases. In addition, in the model with casual jobs, workers in low wage casual jobs continue to search for a higher quality match that will offer work more frequently. In a model with search frictions, this makes it harder for unemployed workers to match with a firm. This crowding out effect offsets some of the negative effects of a ban. I also consider the effect of a higher minimum wage for casual jobs. I find that the effects are limited. These results are due to an offsetting mechanism: although higher wages lead to higher unemployment, as firms offer more regular jobs, the number of workers called-up to work in any one period increases. In the second essay we turn to the other end of the wage distribution, to study the determinants of superstar wage effects, asking whether productivity or popularity-based explanations are more appropriate. We use longitudinal wage and performance data for workers (players) and firms (teams) from a particular market for sports talent: Major League Soccer in the United States. We find evidence that the top earners, whose annual salaries are mostly not accounted for by their past MLS performances, when compared alongside other footballers, are paid more because they attract significantly higher stadium attendances and thus revenues. There is no evidence that higher residual salary spending by the teams affects their relative performance in football terms, or that the amounts the teams spend on actual talent affect attendances. Taken together, these results suggest that a popularity-based explanation of superstar wage effects is appropriate among the top earners in this labour market. In the final essay I study long-term trends in part-time work. I show that there has been an increase in the part-time share over the past 30 years. There has also been an increase in the part-time work on the extensive margin; part-time workers on average work longer. Despite this, the difference in average hourly pay for part-time and full-time workers (the part-time pay penalty) has steadily decreased. I develop a flexible neoclassical model of the labour market which can explain firms' and workers' preferences for part- and full-time work. The equilibrium of the model matches key features of the labour market: full- and part-time workers undertake different tasks; there is bunching of workers at full-time hours; and full-time workers earn higher hourly wages than part-time. The model can be used to disentangle the effects of changes in workers' preferences and on firms' production technologies on the relative quantities and prices of part- and full-time labour. I provide an extension of the model which incorporates heterogeneity in workers' preferences, and will enable the study of gender differences in part-time work.

This thesis aims to systematically unpack the relationship between financial development and income inequality using a broad panel dataset of up to 151 developed and developing countries for the period 1980 to 2014. The first empirical chapter (Chapter 4) investigates whether the finance-inequality nexus depends on the specific measure used to capture the multidimensional aspects of financial development - such as access, depth, efficiency, and stability - related to banking systems and stock markets. Using a series of panel data techniques with various robustness checks, one of the significant findings to emerge from this study is that while some aspects of financial development contribute towards alleviating income inequality, others may have a reverse impact. To further unpack the finance-inequality nexus, the second empirical chapter (Chapter 5) probes beyond the mean effects to explore whether the effect of financial development on income inequality varies according to the level of inequality. For this purpose, a quantile regressions technique is adopted to ascertain the full distributional impact of financial development pertaining to not only the centre but also the upper and lower ends of the inequality spectrum. The results reveal that different aspects of financial development may not yield the same effect for countries with higher inequality levels compared to countries with lower inequality. Furthermore, these findings shed meaningful light on which aspects of banking systems and stock markets aggravate or alleviate income inequality in the context of countries with high-, moderate- or low-income inequality, thereby aiding policymakers to devise and implement effectual policy decisions. Finally, the third empirical chapter (Chapter 6) aims to unfold whether the relationship between financial development and inequality is contingent on the degree of financial development. While existing theory suggests that the impact of financial development on inequality may depend on the stage of financial development that the country is undergoing (Greenwood and Jovanovic, 1990; Aghion and Bolton, 1997), the empirical studies on such regime-shifting effects have remained relatively scant. This chapter, therefore, investigates the implications of financial regimes in exerting a differential impact on income distribution. To this end, a panel threshold regression approach is employed, which allows the detection and inferential analyses of possible threshold effects and regime shifts in economic relationships. The key finding is that the finance-inequality nexus is indeed contingent on the distinct level or regime of financial development. Therefore, the findings of this thesis collectively provide several critical insights on the finance-inequality nexus. The important lesson to be learned is that researchers should not simply rely on a narrow definition of financial development to ascertain the impact on income inequality. At the same time, policymakers need to be more cautious in their approach towards effectively targeting and promoting the inequality-reducing aspects of financial development in the context of countries with different inequality levels and financial regimes.

This dissertation addresses three interlinked questions that revolve around the theoretical finding of Meltzer and Richard (1981) which predicts a monotonic relationship between income inequality and redistribution. Chapter one studies an overlapping-generations political economy where all young, who differ in their productivity, and old agents vote on two tax rates, levied on the young's income. These tax rates finance social security system and intragenerational income redistribution. We characterise a unique sequential voting equilibrium where both programmes survive if intragenerational income redistribution's median voter has lower income than generalized mean. We show that a rise in generalised mean income increases the size of social security, decreasing the size of intragenerational income redistribution. We conclude that, unlike the Meltzer and Richard's (1981) result, monotonicity between intragenerational redistribution and income inequality disappears in a bidimensional policy space. Chapter two analyses the effect of in-group altruism on redistribution. All consumers, who differ in their productivity and belong to different social groups, vote over a redistributive tax rate. We show that in presence of in-group altruism, agents' preferred tax rate depends on their income, the generalised mean income and on their social groups' average income. We conclude that rich prefer high, and poor prefer low redistribution, and that the decisive voter may not have necessarily the median income. Chapter three studies how effective tax revenues are allocated to cash versus in-kind transfers. Agents with pretax income differences vote over a tax rate and the allocation of effective tax revenues to in-kind and cash transfers. We find that agents choose only in-kind transfers if the median voter's has high income and an increase in income inequality increases the equilibrium tax rate. If median voter has sufficiently low income, both transfers are chosen and an increase in income inequality increases the equilibrium tax rate and in-kind transfers.

Scholars have highlighted the role of income distribution as a fundamental factor to understand consumption, health, adoption of technologies, social cohesion, democratic stability, and long term economic performance, among other phenomena. Moreover, reducing income inequality was included in the United Nations’ Sustainable Development Goals. However, less attention has been put on the link between differences in household incomes and other pressing sustainability challenges, such as those that depend on massive adoption of new technologies within network industry sectors: telecommunications, waste management, transport, energy and water. Does existent income inequality translate into adoption gaps within these sectors? Is inequality an obstacle for advancing the vision of an inter-connected and more sustainable world? This research explores these questions through seven stand-alone papers, which focus on adoption of broadband internet, municipal recycling and railway passenger transport. Part I of the thesis includes four papers based on publicly available data from traditional mainstream sources. Chapter 1 provides a systematic map of the peer-reviewed literature on the link between income inequality and adoption of the three selected network technologies. Chapter 2 looks at country-level panel data from OECD countries. Chapter 3 analyses cross-sectional data in a broader world-wide sample. Chapter 4 compares borough-level recycling and income distribution in two European cities: London (United Kingdom) and Barcelona (Spain). Part II provides an in-depth analysis of two South American metropolitan areas: Santiago (Chile) and Medellín (Colombia). This part includes three papers (chapters 5, 6 and 7), each one focusing on a specific sector, that employ mixed-methods based on fieldwork conducted in both cities. The main contributions of the thesis are new evidence on the negative effect of income inequality on network technology adoption, and a discussion of the role of formal and informal institutions in this relationship.

This thesis focuses on financial inclusion (FI) across countries. FI is defined by the Consultative Group to Assist the Poor (CGAP) as the procedure of providing all entities (households and businesses) with access to an affordable and high-quality range of financial products and services, which should be provided responsibly and sustainably in a wellregulated environment. The thesis can be divided into three papers (Chapters 2, 3 and 4).The Chapter 2 examines measures of FI that include both the indexes and some simpler indicators derived from the World Bank’s global financial inclusion (FINDEX) database and the IMF’s Financial Access Survey (FAS) database. Indexes of financial inclusion (IFI) are constructed (where the data permitted) for around 183 countries between 2011 and 2017.The six consistency conditions suggested by Bauer et al (1998) are applied to compare IFIs. The findings show that only two indexes fulfil the consistency conditions, namely, the Sarma (2012) index and a new index (NI) suggested in chapter 2 of this thesis. Moreover, using various approaches (two-step system Generalized Method of Moments (GMM) dynamic panel estimation, fixed effect two stage least squares (2SLS) with instrumental variables (IV), and fixed effect estimates) the study confirms that FI reduces income inequality, improves human development, and boosts economic growth. In addition, the Sarma (2012) index and the NI have performed better than FAS and FINDEX indicators with macroeconomic factors. Chapter 3 studies the determinants of FI using a wide selection of possible determinants from the literature. FI is measured using the index of Sarma (2012) and NI; simpler indicators derived from the FAS and FINDEX database are also included. The study covers 80 countries from 2011 to 2017. The analysis carried out includes fixed effect panel estimators, and fixed effect 2SLS with an IV. The findings reveal that income, human development, rule of law, and banks’ credit to banks’ deposit ratio are the main determinants of the level of FI at macro-economic level. Chapter 4 examines whether countries with considerable Muslim populations (CCMPs) have a lower level of FI compared to the rest of the world (RW). FI is measured by the index of Sarma (2012) and the NI; simpler indicators derived from the FAS and the FINDEX database are also included. The study covers 80 countries (22 CCMPs and 58 from the RW) between 2011 and 2017. The results demonstrate that the difference in the overall level of FI between CCMPs and the RW is insignificant. Looking at each aspect of FI show that the difference in level of FI is insignificant in financial demographical and geographical coverage as well as in firms’ level of FI. However, there is a significant difference at the percentage of population participating in the financial system. Chapter 4 examines whether the introduction of Islamic banks can raise the level of FI in CCMPs. However, the result turned out to be insignificant. This is because the IBs have a negative relationship with some aspects of FI cancel off the positive relationship with other aspects. There are five reasons behind the negative relationship that IBs have with some of the aspects of FI. First, the limited number of Islamic financial products and services. Second, the low ratio of credits to deposits in IBs, which considered one of the main determinant of FI. Third, the risk and cost of financial services in IBs. Fourth, previous studies that suggested introducing IBs to enhance the level of FI in CCMPs have not directly measured the relationship between IBs and FI. Fifth, financial awareness and financial literacy. Therefore, regulators and policymakers should evaluate the business model applied by IBs and modify it in a way that enhance the level of FI.

The role of inequality in development has been the subject of long-standing debates in academic and policy circles. Notwithstanding disagreements about exactly how the two are linked, conventional wisdom agrees that inequality is an objective 'fact' that can be measured free from ideological considerations. New data detect trends towards higher inequality, weaker economic positions for those at the bottom, and a concentration of wealth at the very top of the distribution in most regions. Inequality studies as currently practiced are ill-equipped to accommodate the empirical changes and the resulting theoretical implications. Putting an end to over half a century of mainstream consensus assuming that inequality would automatically recede with developmental progress, the discipline needs rethinking. My thesis proposes a new research agenda for studying inequality that is not only able to integrate these empirical developments, but which also challenges what has been taken for granted: that inequality just is, independently of context, time and observer. Instead, it proposes that along with its objective existence, inequality is a relational phenomenon subjectively experienced relative to a particular context. In five interconnected Sections, my dissertation challenges conventional views of how inequality looks, how it is seen, and what can be done about it, especially in developing countries. The study focuses on the ways in which inequality is perceived, and how it is perpetuated. After an introduction to the subject in Section I, Section II investigates how inadequate measurement perpetuates inequality, proposing a new indicator that shows that inequality is largely defined in the extreme ends of the income distribution. Section III examines the reproduction of inequality at the bottom, contrasting minimum wage policies over recent decades in Mexico with those of other countries in Latin America. In light of a political economy resistant to change, Section IV scrutinizes Mexican elites, exploring how inequality is perceived from the very top of the income distribution, how this affects policy-making and, subsequently, measured inequality levels. Section V concludes by outlining the theoretical and practical implications of my findings.

The chapters of this thesis comprise three separate studies on topics in behavioral and development economics. The first chapter discusses the impact of advantageous and disadvantageous income inequality on self-reported life satisfaction. The second chapter analyses the effect of access to financial services in rural India on agricultural outcomes. In the third chapter I introduce a new instrumental variable to identify the effect of peer expenditure on household consumption. Chapter 1. Spiteful Preferences or Inequality Aversion: What drives the Comparison Income Effect? In this chapter I use happiness data to distinguish between spiteful and inequality averse preferences. Both are consistent with the Easterlin paradox but have quite different implications for the relationship between happiness and income inequality. Empirical evidence suggests that happiness is decreasing in the income of relevant others (i.e. comparison income). On its own, this relationship provides insufficient evidence to pin down the underlying preferences but a remedy is available. The simple comparison income model is nested in a more general utility function which accounts for several types of interdependent preferences. Using data from the German Socio-Economic Panel (SOEP) survey, I demonstrate that the full model has more predictive power than the reduced one. Moreover, aversion to income inequality appears to drive the comparison income effect. The results are robust to several alternative model specifications. Chapter 2. Rural Banks and Agricultural Production: Evidence from India's Social Banking Experiment In this chapter, we study the effects of improved access to banking services on agricultural production in India. We exploit a series of policy rules during the 1980s to generate a time-varying instrument for rural branch expansion at the district level. We find that a 1% growth in rural banks increased aggregate yields by 0.4%. This effect is driven by an uptake in the cultivation of higher-yielding varieties of cereal crops, as well as an increase in the area share allocated to cash crops. Banks also attenuate the effect of lagged rainfall on output, via changes in the use of irrigation. Consumption-savings decisions with interdependent preferences. Staying ahead or catching up? In the third chapter, I estimate the effect of expenditure disparity on household consumption using a novel instrumental variable. In a life-cycle setting, households are assumed to care about the distance to others above and below them in the expenditure distribution. To solve the endogeneity problem arising from correlated and exogenous effects, I instrument expenditure disparity with the share of households who receive unexpected windfall income. Using SOEP data, the average household is found to have envious and prideful preferences in that growing disparity to those who spend more and reduction in the disparity to others who spend less is associated with consumption expenditure growth.

The main purpose of this study is to develop an understanding of the impact of neoliberal financialisation on income inequality. The distributional patterns and their relations to financialisation in four countries (USA, South Korea, Argentina, and Sweden) between circa 1980 and 2010 are analysed and compared. This research involves addressing the question as to whether financialisation facilitates uneven capital accumulation and generates conditions that increase income inequality. Critical realism's approach to ontology is employed to situate the empirical trajectories of economic disparity in the context of finance capitalism. Drawing on comparative political economy, the analytical framework of a financialisation-induced income inequality hypothesis was developed. This framework is based on the assumption that finance within the neoliberal mode of production facilitates upward income distribution. The investigation included developing three explanatory causal-processual analytical constructs derived from different heterodox schools of thought. It is contended, that in order to comprehend the nature of social reality in the financialisation-income inequality nexus, the non-orthodox methods of an open system, as advocated by critical realists, are required. The results of this study indicate that there are causal relations between upward income distribution and financialisation of national economies that developed after neoliberal restructuring. In particular, new institutions of neoliberal financialisation regressively affect the functional distribution of income. Specifically, with financial liberalisation, profits and rents in financial sector increase, whilst labour's share decreases, thereby exacerbating the level of private/public debt. In USA, South Korea, and Argentina the hypothesis was confirmed, while in Sweden neoliberal restructuring was not achieved and the national model was not transformed to affect income distribution regressively. This research has led to the identification of components of upward distribution in finance capitalism and causal links in the financialisation-induced income inequality nexus. An institutionalised generative mechanism of regressive income redistribution is an effect of finance capitalism, which transforms national distributional trajectories.

This thesis explores the role of openness to international trade on economic development, characterised by economic growth and income inequality, across countries. The existing empirical literature has shown that the effect of trade on economic development may not be well captured by models that impose a completely linear functional form. Thus, the majority of existing literature has ignored the possibility that the effect of trade on economic development may be subject to model mis-specification or be contingent on other factors. This thesis therefore re-examines the effects of openness to international trade on economic development across countries by addressing these gaps in the literature. First, in chapter 2 we contribute to the existing literature as we systematically address shortcomings related to model mis-specification and variable mis-measurement levelled at previous studies examining the effect of trade on economic growth. In order to do so, we apply nonparametric models to a novel dataset that treats trade among countries as a weighted network. Our application on a panel of 107 countries from 1970 to 2012 finds that, compared to the commonly used measure of exports and imports as a share of GDP, a network based perspective on trade is more relevant in explaining economic growth. We also find that this effect is generally linear which suggests that trade does not have a threshold effect on economic growth. We also exploit the fact that our dataset measures trade in raw goods and trade in capital goods to show that being closer to the world trade network in terms of the latter has the stronger effect on economic growth. This follows the suggestion of Hausmann et al. (2007), among others, that, in order to develop industry, developing economies should trade in goods that developed economies also trade in. We also document significant heterogeneities in the effect of trade on economic growth across time and regions. For instance, across time, trade in raw goods significantly increased economic growth in the mid-to-late 1970s while trade in capital goods had a significantly positive effect in the decade after 1985. Across regions, trade had the strongest effect on economic growth in the Middle East & North Africa while it had no significant effect on economic growth in Sub-Saharan Africa. These results, robust to functional form and endogeneity, support the conclusion of Rodriguez and Rodrik (2000) in that the effect of trade on economic growth is contingent on time and geography. Second, in chapter 3, we contribute to the existing literature as we show that, unlike in previous studies, increased trade may not necessarily enhance income inequality across countries. Our approach differs from the existing literature as it explicitly shows that schooling is a threshold variable that conditions the effect of trade on income inequality. Our application on a panel of 118 countries from 1970 to 2014 finds the threshold models of Hansen (2000) and Caner and Hansen (2004) to be superior to interaction models typically used in previous studies. We also document that, ceteris paribus, the inequality enhancing effect of trade found in previous studies can be reversed once (a) re-distributive policies are present and (b) countries accumulate, on average, approximately 6 years of schooling per capita. This is consistent with the model of Cartiglia (1997), among others, that predicts an inverse-U shaped relationship between trade and inequality. We also examine potential heterogeneities in the threshold effects of schooling and show that the strongest threshold effect lies in tertiary schooling per capita with 0.250 years being the estimated threshold value. Comparing our estimated threshold values to raw data on types of schooling across regions, we find that Sub-Saharan Africa is the only region that consistently falls short of these values while at the same time it is the region least open to international trade. Our results also suggest that "Cash for Education" programmes are promising forms of re-distributive policies that can help developing economies achieve these schooling "targets" and reverse the inequality widening effect of increased trade found in previous studies.

This thesis examines the effects income inequality has on economic growth, drawing on data from China. It focuses on two related questions: whether income inequality is harmful to economic growth and, if so, why. The first empirical chapter uses a newly-developed panel dataset at the province level to examine the long-run impact of income inequality on economic growth, addressing the problem of spurious regression that affects much of the existing literature. The empirical results indicate that the long-run effect of income inequality on economic growth is non-linear: while income inequality exerts a positive impact on economic growth for rich provinces, it is harmful to economic growth for poor regions. The second empirical chapter provides mathematical and empirical evidence that demonstrates the deficiencies in existing studies that solely rely on macroeconomic data. It examines three mainstream transmission mechanisms by using data at both the household and village level. At the village level, the empirical results show that income inequality leads to lower economic growth. However, at the household level, income inequality is positively linked to income growth for households with low levels of initial income. Such seemingly contradictory results agree with the predictions of my mathematical example and suggest that the political economy channel is responsible for the inequality-growth relationship in rural China. The last empirical chapter examines whether inequality and growth are linked across generations by evaluating the impact of the One Child Policy on fertility and education in China. Using a difference-in-differences approach, the empirical results suggest that the One Child Policy successfully lowered the probability of having a child for Han women and increased the probability of attending school for Han children. This empirical evidence indicates that the endogenous fertility channel operates in China.

The motivation for subjective well-being research rather than Gross Domestic Product (GDP) is becoming important to the roles of many governments across the globe and so identifying the strongest correlates of subjective well-being is vital as a starting point to informing policies that support subjective well-being. This thesis investigated the correlates of subjective well-being. Chapter 1 introduced the topic and has been divided into two parts: section 1 explores the motivation for subjective well-being research and section 2 presents the conceptual model of subjective well-being. Chapter 2 gave the rationale for the methodological approaches taken to investigate factors that are associated with subjective well-being. Also, the methods chapter presented limitations of the data used. Chapter 3 explored the determinants of subjective well-being in representative samples of nations; and the results obtained in chapter 3 led to three systematic reviews and meta-analyses (Chapter 4, 5 and 6). Chapter 4 conducted a systematic review and meta-analysis of the association between income inequality and subjective well-being to test the general assumption that people's subjective well-being can be increased by tackling income inequality and investigated inconsistencies of previous studies reporting a negative, positive or no association between income inequality and subjective well-being. Chapter 5 carried out a systematic review and meta-analysis of the association between health status and subjective well-being because the results of the empirical study conducted in chapter 3 suggest that health status is positively associated with subjective well-being. Chapter 6 conducted a systematic review and meta-analysis of the association between financial satisfaction and subjective well-being as the results of the empirical study conducted in chapter 3 suggest that financial satisfaction is positively associated with subjective well-being. Chapter 7 discussed the results, highlighted the need for further studies and policy directions and concluded. Taken altogether these studies suggest that: (1) subjective well-being is important to informing policies that support subjective well-being, (2) they might be circumstances where income inequality may not be associated with people's subjective well-being, (3) health status and financial satisfaction are positively associated with subjective well-being and the magnitude of the association is affected by key operational and methodological factors, (4) life satisfaction might be preferred to happiness as a measure of subjective well-being because it may better captures the influence of health status and financial satisfaction, (5) government policies that support subjective well-being measures should consider using self-reported health status and financial satisfaction amongst factors that are correlated with people's subjective well-being, (6) the association between health status and subjective well-being and the link between financial satisfaction and subjective well-being are medium and further research is required to identify other strongest correlates of subjective well-being.

To explain and challenge the growing level of income inequality in organisations, this thesis collected and analysed corpora of texts about pay in UK universities from the press, remuneration committees and trade unions. Deploying the methodology of critical discourse analysis, it describes the contents of arguments as discourse types, interprets the reasoning behind arguments as genres of organisation theories and explains the common-sense assumptions ordering arguments as ideological values. Seeking answers, the analysis groups 30,038 data fragments into 74 first-order discourse types, 7 aggregate genres of organisation theories and 9 ideological values across three corpora of texts. Finding from the press suggested that actors drew upon the same set of organisation theories regardless of whether they were discursively challenging or defending the legitimacy of income inequality. This made it unfeasible to halt the level of income inequality because the underlying ideological values of competition, quantification and economic rationality only required the organisations to conform to unclear methodological processes. Thus, it is only possible to challenge the legitimacy of income inequality by proposing new members' resources, which objectified the exact contingencies for when it was appropriate. This insight lead to the creation of a new genre of organisation theory, which proposed paying employees relative to their comparative sacrifices. Findings from remuneration committees suggested that their members drew upon organisation theories to legitimise income inequality, which related to the ideological values of economic science, individualism and capitalistic hierarchy. However, how these ideological values constructed the legitimacy of their decisions lacked a substantiate rationality because the neoliberal model of capitalism was a source of legitimacy within itself. As such, the foundations of legitimacy were critiqued and a 2x2 matrix consisting of a process-outcome axis and pragmatic-moral axis was introduced. Applying this matrix to this corpus of text meant that none of these genres of organisation theories reasoned based on outcomes. Therefore, a new genre of organisation was proposed which focused on the income distribution shape for organisations. Findings from trade unions suggested that their representatives drew upon the same set of organisation theories to reinforce their own legitimacy in addition to interrogating the legitimacy of universities. These organisational theories were then related to the ideological values of performativity, exchange relations and freedom that hegemonically legitimised income inequality. Meanwhile, it was interpreted that trade unions relied on the neoliberal model of capitalism for their existence and were encouraging employees to participate in markets that only served the interests of employers. Therefore, a new members' resource was proposed, which conceptualised why sacrifice was a moral and pragmatic process for distributing pay to employees in comparison with other macro-economic frameworks. The findings from these three corpora of texts explained and challenged the social practices that were creating income inequality growth. Essentially, the ideological values of neoliberalism ordered discourse so that there was no reason to reduce the level of income inequality according to the dominate members' resources. Therefore, to change these social practices three new discourses were proposed which challenged the level of income inequality by illustrating the false consciousness embodied within their reasoning.

China's economic development has performed spectacularly during the period of China's economic transition as a result of radical economic reform in the all markets. The country has also gone through extensive fiscal reforms in the last three decades. However, a number of problems have been associated with such rapid economic growth. One of these has been raising inequality. In both Keynesian and neoclassical endogenous growth theories, public spending can play an important role for economic growth and inequality. The majority of previous studies have focused on the relationship between public spending and economic growth, or between public spending and inequality separately. There is no doubt that public spending has an effect on both economic growth and equity simultaneously. In this respect, this thesis attempts to address the problems that have emerged during the period of China's fiscal reforms, and seeks to examine the effects of public spending on economic growth and equality in the same model. This thesis investigates the dynamic relationships among these three variables in China. For aggregate national data, vector error correction model (VECM) has been used. Analysis at the provincial level is based on the panel vector auto-regression (PVAR) model. These methods help to solve the endogeneity in estimations. The national level analysis indicates that total public spending shows a long term Granger causality with GDP per capita, which supports the positive growth effect of public spending in the Keynesian and endogenous growth model. Social public spending has a negative effect on real output per capita in both the short term and long term, but it also has a negative impact on income inequality. Moreover, we find that a higher level of real GDP per capita will increase the level of inequality, but a higher level of inequality has a negative effect on real GDP per capita in the long term. Furthermore, total provincial public spending and provincial social spending have either a non-significant effect on economic growth. On the other hand, the SOEs' investment has a significant, positive growth effect at both the national and provincial level. As for the redistributive role of the public spending, the provincial total public spending and social spending have played an important role on income distribution. Furthermore, the Gini coefficient has a positive effect on the per capita growth rate at the provincial level, but the economic growth has no significant impact on the Gini coefficient.

Rising inequalities between and within income categories (especially labour and capital) haveemerged as an increasing concern particularly in the last two decades. One of the main reasons for this has been a sharp decline in the wage share in many countries. A declining wage share refers to a decrease in the size of the total wage bill relative to either national income or net value addition (NVA). India is an important example of this situation. Trends at the level of aggregate statistics show that the wage bill has not kept up with productivity increases. This has led to a sharp decline in the wage share, leaving researchers the task of explaining the causes (and consequences) of this decline. The research contributes towards this task by critically examining one of the main avenues ofresearch that has been used in order to explain the causes of a declining wage share in India. This refers to the hypothesis according to which this trend is the outcome of increased capital intensity of employment, or more generally labour-saving investments. The study examines the relevance of this hypothesis for dynamics taking place at a disaggregated level of analysis in Indian industrial manufacturing. In order to do this, three main questions are addressed. The first is whether a declining wage share is a necessary outcome of labour-saving investments in production, or whether other factors are also important in mediating this relationship. The second is the conditions affecting the degree to which a declining wage share also involves increased income inequalities within the labour income category, and in some cases, declining real incomes for workers. The third is the relevance of drawing upon a demand and supply framework for the treatment of the question of causality in the analysis. The study answers the questions by drawing on two very different case studies. The first is thePimpri Chinchwad Industrial Township (PCIT), located in the outskirts of Pune (State ofMaharashtra, western India). The production processes characterising many of the factoriesoperating in this area are capital intensive. The second is the art metalware industry in Moradabad (State of Uttar Pradesh, northern India). The production processes taking place in the majority of units in this area are labour-intensive. The findings suggest that the factors contributing to a declining wage share cannot be analysed without at the same time examining the distributional set-ups within which technological changes take place, and how these arrangements are changing. Firstly, many of the factors contributing towards a declining wage share are not directly caused by changes in technology, and hence skill requirements, in production. This includes the weakness (and further weakening) of the mechanisms linking wages to productivity at the firm and sectoral level. Secondly, a declining wage share also involves changing income inequalities within the labour income category. The sources of these inequalities are not only linked to differentials in skills. Thirdly, this is happening in the context of speedy changes in the economy, including changing needs. This makes the links between wages and productivity an important requirement for the labour income category to be able to benefit from increased productivity, not only as workers through the wage system, but also as consumers. Lastly, many of the variables that emerge as important in the analysis cannot be subsumed under a demand and supply framework. One of the implications for the treatment of the issue of causality is the need to move away from seeking causal links in the traditional ‘cause and effect’ framework, to questions about how certain trends come about. This also has consequences for the normative side of the debate.

This thesis addresses the question, whether the impact of financial development on the relative and absolute indicators of poverty is dependent on the levels of the human capital present in an economy. To answer this question, first we develop a theoretical framework to explain the growth process in the context of financial development assuming that human capital is heterogeneous in terms of the skills and education people have. Then, by using the data sets based on five-year averages over 1960-2010 and 1980-2010, covering 107 developed and developing countries, we empirically investigate the extensions of the theoretical framework developed earlier. These extensions cover the relationships between: 1. Income inequality and economic growth 2. Financial development, human capital and income inequality, and 3. Financial development, human capital and poverty We provide empirical evidence using modern panel data techniques of dynamic and static GMM. The findings elucidate that income inequality and economic growth are inter-dependent on each other. There exists an inverse relationship between initial inequality and economic growth. The changes in income inequality follow the pattern identified by Kuznets (1955) known as Kuznets’ hypothesis. The results also show that financial development helps in reducing income inequalities and in alleviating poverty, only when there is a sufficient level of human capital available. On the basis of our findings we develop the term "effective financial development" which means that financial development is effective in accelerating growth levels, reducing income inequalities and alleviating poverty only if there is a sufficient level of human capital available. The empirical study covers multiple aspects of financial development like private credit extended by banks and other financial institutions, liquid liabilities and stock market capitalization. The results of the empirical investigations are robust to multiple data sets and various indicators of income inequality, financial development, poverty and human capital. The study also provides marginal analysis, which helps in understanding the impact of financial development on inequality and poverty at different levels of human capital. This research study of effective financial development can be a useful learning paradigm for the academics and researchers interested in growth economics and keen to learn how poverty and income inequality can be reduced effectively. This study can also be useful for the policy makers in the financial institutions, because it provides robust empirical evidence that shows that financial development cannot help in alleviating poverty and in reducing inequalities unless there is a sufficient level of human capital available. The findings can be useful for policy makers, particularly in the developing countries where high levels of income inequalities and poverty are big problems. This study explains the mechanism of how effective financial development can be used to reduce income inequalities and to alleviate poverty. It also explains the process of inter-linkages between financial development, human capital, inequality, economic growth and financial instability. The policy makers can also take advantage from the marginal analyses that illustrate the minimum levels of private credit and primary and secondary schooling above which the effects of financial development and human capital become significant in reducing inequalities and poverty.

This thesis consists of three chapters that analyze theoretically the role of income inequality in consumer markets. Each chapter introduces distributional considerations into an economic model where previously inequality did not play a major role. Chapter one uses a consumer search model to show under what conditions the distribution of income within a community is related to the type of firms that exist within that community, impacting the level of prices. We show that if time and money costs of search are high enough, only the middle class have incentive to search and therefore are the most aggressive shoppers. Using a supply side model, we argue that firms located in more informed communities are more likely to enter the market as large low-priced retailers. Connecting these two results, the model shows under what conditions the size of the middle class can have a negative relationship with the level of prices. Chapter two demonstrates how firm pricing strategy and determinants of household location can interact to determine city structure. In this city, consumers and firms live on a continuous line interval. The model consists of two types of firms; many high-cost perfectly competitive firms located in the Central Business District, and one large low-cost "Superstore", choosing its price strategically. We show how the shopping habits of the consumer population, as determined by the relative price of the Superstore and the Corner Stores, can contribute to the various income segregation outcomes described in previous literature. In addition we consider the impact of city population structure on the pricing decision of a monopolist facing a competitive fringe. Chapter three uses a simple model of banking services to consider how deposit-taking banks price for their services and choose the type of deposit customers that they target. This chapter goes beyond previous theoretical work on consumer banking, identifying the role of household income in the access to deposit services. We show that a higher rate of return on investments available to banks lowers financial exclusion, increasing the profitability of low-income consumers for deposit-taking institutions. This suggests that the possibility of financial exclusion increases in periods of recession. The chapter demonstrates how an increase in income dispersion can lead to a greater proportion of consumers excluded from mainstream banking.

The collapse of the communist regimes in Central and Eastern Europe in 1989-1990 heralded the beginning of an economic transition from central planning to market economies. The subsequent period was marked by malfunctioning of these countries’ social sectors, including their health care systems, raising serious issues of equity. This thesis examines the impact of the transition period and the introduction of social insurance on equity in health care provision in Bulgaria. Equity in health care is investigated with respect to function - i.e. financing (according to ability to pay) and delivery (according to need) - and outcomes - i.e. health status, income inequality and poverty. Differences in health, health care financing and delivery are explored by income, education, ethnic, employment, marital status, age and sex groups. Furthermore, the thesis outlines the impact of health care provision, in particular social insurance, on poverty and health inequalities. The thesis employs empirical analysis based on household data. Its methodology includes concentration and decomposition analysis, and provides new ways of modelling health care financing and delivery, as well as the link between health and health care delivery. The thesis concludes that social insurance does not provide a uniform means of improving equity and that the root cause of the problem lies in the large proportion of out-of-pocket payments and the rather limited size of the health insurance sector. Inequity in health care provision leads to poverty and untreated illness. The data suggests that there are differences between socio-economic groups as regards their likelihood to seek treatment for their ill health, which result in differences in their health status. The social factors that have impacted the most on health are low education and low income.