as structural transformation brings workers from the lowerinequality lowerproductivity agricultural hinterland to the urban manufacturing sector aggregate inequality first increases with development before eventually falling the extent to which this will prove to be case in the large converging countries remains an open question even when growth remains modest countries with adequate financial and administrative capacity can reduce poverty through redistribution public action is also important as a tool against nonincome forms of deprivation through the provision of key public goods such as health care education water sanitation and other services