Many economists take it for granted that world income inequality is falling.
Simpler versions of neoclassical growth theory assume that average productivity levels and average incomes will converge as capital moves from developed countries to capital-scarce countries of the south. China, post-Mao, is dramatically engaged with the world economy. Export growth has exploded by a massive 500 percent since 1980. China now trusts in exports as the engine of growth and the safety net for a domestic restructuring which has created high levels of urban unemployment. Decentralisation is trendy.