 Okay, so we're good morning and welcome to this session and idea and insight with Professor Joseph Stiglitz. This session is being live-streamed in the World Economic Forum's website and you can send questions if you're hearing from outside of this hall to the hashtag equal growth and we'll get some of those questions hopefully in time. Professor Stiglitz is a university professor at Columbia University. He's also the founder and co-president of the University's Initiative for Public Dialogue. He has taught at Princeton, Stanford, MIT and Oxford. He has been a member and chairman of the Council of Economic Advisors during the Clinton administration and also chief economist and senior vice president of the World Bank. Professor Stiglitz was awarded the Nobel Prize in Economics for his analysis of markets with asymmetric information and was a lead author of the 1995 report of the Intergovernmental Panel on Climate Change which also received the Nobel Prize. He's also a very prominent author. He has authored many books to name a few globalization and its discontents, the roaring 90s, Making Globalization Work, The Price of Inequality and most recently just published this year, The Great Divide on Equal Societies and what we can do about them. Professor Stiglitz is an honor to have you with us in Riviera Maya. It's nice to be here. Thank you. We're gonna have a dialogue with Professor Stiglitz and towards the last 15-20 minutes we're gonna also open up for your questions. Professor, you've spoken extensively and written extensively about inequality, namely in your past couple of books and we've seen that most of the world has become more unequal during the past decade. Even in advanced OECD economies, the gap between rich and poor is at its worst level during the past 30 years. Also in Asia in fast growing Asian economies we've seen inequality deteriorate and Latin America has been an exception to this trend. What do you think Latin America did well between 2002 and 2012 to see inequality decreasing virtually every Latin American country with the exception of Guatemala and some periods also Costa Rica and Paraguay? Yeah, the point you raised I think is a really important one. It's something I've stressed in my work. A lot of people looking at the United States, Europe and all these countries with increasing inequality have said, oh, it's inevitable. It has to do with the laws of economics, with technology, with globalization. And the fact that Latin America, you know, same global economic forces, you've actually become more globalized in the last 15 years, have bucked the trend, says it's not about technology, globalization. They may have a part to it, but it emphasizes that it's about the policies. And that says it's a matter of choice, it's how we structure the economy, it's the rules that we put together. So for instance, one of the big successes is in Brazil, where you had a succession of presidents, Cardoza began some very important education policies, where made a very big effort to make sure that there was much more widespread education than in the past. And then President Lua had all these programs that were focused on hunger, on health, continued the education programs. And then I have to say, there was a lot of innovativeness. You know, you talk about, everybody talks about, especially Davos, innovation, but there was a lot of social innovation. I think we sometimes underestimate the importance of social innovation. And one of those was the conditional cash transfer. So you provided a framework that really encouraged people to make sure that their children got the education that they needed, got the vaccinations they needed, and the food they needed. So it really, I mean, it is really one of the real successes. Latin America has been really one of the successes around the world. Yes, and I think Mexico is also a good example of the conditional cash transfer programs that has gone, you know, for three administrations now. It started during the Cedillo administration, like Progresa, then during the Fox administration, Opportunidades, during Calderón administration as well, and now during Presente Peña continues as Prospera. So it's also a good example of conditional cash transfer. And one of the things I think that's been very strong about this issue in Latin America is that you might say it's bipartisan. It's both center-left and center-right governments. So it's not, you know, this issue of inequality is not seen as a partisan issue. It's seen as something that if a society is going to function, there can't be too much of an extreme. And you mentioned Brazil as one of the successful examples. And I completely agree also, you know, we've seen that not only did they reduce inequality, but also alleviated poverty, significant amounts of the Brazilian population. Also, Argentina, you know, achieved some decreasing inequality. However, we see that these two countries are now facing economic and political crisis, and the forecast is that this year the Argentinian and the Brazilian economies are going to shrink by 1 percent in Argentina, by 1.5 percent in Brazil. Do you think these achievements in inequality and poverty alleviation can be sustained with a shrinking economy? I think they can be sustained. The issue is, will they be sustained? You know, should you treat poverty as alleviation, reduction of poverty as a luxury good, that when things are going well, you have some of it, but when things go bad, you put it on the side? Or should you think about it as basically a core of the economic program? And let me tell you how I think about it. And this represents, I think, one of the biggest change, two of the biggest changes in how we see inequality today, rather compared to 20 years ago. The first is that we used to think that there was a trade off. The economists love trade off, so you could have more equality or more growth, but if you wanted more equality, you would have to give up on growth. Now we see the two as compliments, that you can have stronger growth if you have, if you reduce the extremes of inequality. And we are not talking about getting rid of inequalities, reducing the extremes. And that was one of the main points in my book, The Price of Inequality, where I chose the title to emphasize that we pay a very high price for excessive inequality, particularly inequality that comes from monopoly power, lack of competition. You know about that here in Mexico. You pay a high price from inequality that comes from lack of educational opportunity for everybody. Again, something that you know about here. So there are all these aspects that if you don't get them right, you get more inequality and lower growth. So that's the first, I think, important thing to realize that that they shouldn't give up on their attempts. And the second one is that these are long run issues. So it's to use American colloquial and petty wise and palm foolish. That is it's very foolish to cut back on education today or one of these basic programs that are directed at reducing inequality and helping and reducing poverty, it's foolish to cut back on those because that will lower the long term potential growth. Just as a little bit of an aside, you know, if we have time later on, we'll talk about Europe. One of the big mistakes that Europe is making now are the extreme cutbacks, you know, the extreme austerity. And in many of the countries, those cutbacks are going to have results that will lower the growth potential. Not only the growth today, you know, we all know that growth today has been disaster, but lower the growth potential for the next quarter century. Well, I think it's it's great news that, you know, finally is no longer conventional wisdom that there's a trade off between growth and equality, but actually that there are complementary and countries that are more equal can actually grow faster. Latin America's growth story has been quite erratic. You've seen periods of rapid growth in some countries followed by slower zero growth. I think with the exception of Chile, most Latin American countries have had very erratic growth patterns. Why do you think Latin America has underperformed in terms of economic growth relative to other regions like East Asia and Southeast Asia? Well, there are there are a couple aspects of that. You mentioned the erratic. One of the reasons for the erratic growth is there's been the excessive dependence on natural resources without creating the framework that has to respond to the huge volatility in the prices of those. And that's where Chile has been the exception. They created the stabilization fund. And that stabilization fund has enabled them to weather the copper prices go up and down. And you would have thought, given their historical dependence on copper, that that would have led to huge volatility in their economy, but they created the stabilization fund. So that's the first thing they did. The second thing that Chile did was diversification of their economy. The government and a foundation that was basically created as part of a settlement of a complex issue, but created an industrial policy. So it went from an excessive focus on copper to, you know, now they export fish, the berries that we eat all year round in the middle of the winter. A lot of them come from from Chile, wine, lumber. And that to come back, that's one of the successes of Mexico over the last 20 years. You went from being very heavily dependent on oil for your GDP to one to a much more diversified economy. And that's one of the reasons, you know, things are slowing down. But it's still because of your huge manufacturing base, exports to the United States, you've been able to stabilize. So those are the, you know, the two things in terms of how do you manage these? The volatility, one is to create a stabilization fund, which Chile has done, but most of the other countries have not. And the other one is diversified the economy. Yeah, in fact, there's also a planned stabilization fund in Mexico that is part of the energy reform. And the sad part is that, you know, we started the stabilization fund when the oil prices went down. So hopefully one day they will go up and there will be excess, you know, cash to put in the fund. But I do hope that when the oil price comes down and the budget looks very tight, you don't join Europe in your austerity, because we know the results of austerity, lower growth, bigger deficits, more inequality. Yeah. Well, I'm talking a little bit about Mexico. You know that, you know, over the past year and a half, two years, there's been an impressive set of structural reforms that have been approved by Congress, proposed by President Peña Nieto's administration. And they range, you know, from education to labor, energy, telecom, finance, fiscal competition. And we all hope that, you know, those reforms will spur higher growth in your illustrious career, not only as an academic, but also as a policymaker, both in the Council of Economic Advisors and at the World Bank. I'm sure you've seen a good deal of attempts successful and unsuccessful attempts to reform. So I would like to ask you, what do you expect that we could see from these reforms in, say, five to 10 years? And what advice would you give the Mexican government and Mexican society at large to make sure that these reforms are successful? Well, let me say, from what you've done so far, it is very impressive. You know, I've watched Mexican economic policies for a long time. And on a lot of the issues, there was consensus about what should be done. But the politics made it very difficult. And there was a kind of gridlock a little bit like we see in the United States. And you broke through it in the last couple of years. And I think that's a real achievement. I'm actually very optimistic that that these will really spur economic growth. You take issues, you know, prices of telecom, prices of electricity are basic costs of production. And they make it more attractive for firms to come and invest and for Mexican firms to invest. So I think it can be a real spur of economic growth. But let me come back to the issue of inequality, which is the thing why I think if they're done right, and it looks like they're being done right, I think they will really enable Mexico to address the issues of inequality or, you know, reduce the inequality through a couple channels. First of all, when you have a monopoly, you don't have enough competition, what monopolies do is lead to a higher prices. When you have higher prices, that's a reduction in the real wage, wages adjusted for prices for inflation, just as much as lowering the nominal wage. So when prices, when you have the monopoly going up, it actually takes away real income for ordinary citizens. You know, in the United States, we're having a big debate about inequality too, just like many other countries. And one of the focus that we're saying is that there is actually a lot of hidden monopolies all over our economy that weren't quite so obvious as in Mexico, but I think attacking these monopolies is important for inequality. But the second one is if you're going to attract, for a small economy, in a very competitive world, if you're going to attract businesses, if you have high electricity prices or high telecom prices, you have to be competitive in some other dimension. And what is the other dimension? Lower wages. So it drives down the nominal pay wages. It drives up the cost of basic things like telecom and and electricity. And so these reforms will will give us space for higher real incomes of most people on both accounts. There's a third important aspect, and that really goes to how you use the oil revenue. You know, we talked about creating a stabilization fund. One of the and there's been this global discussion of what are called the natural resource curse that countries with a lot of natural resources often don't do very well. And then as well as now a poster child for for that you if you don't manage your resources, you're not going to grow well. And the way I sometimes put it is natural resources are like an asset, a capital good, it's beneath the ground. And if you don't convert that asset beneath the ground into an asset above the ground to human capital, physical capital infrastructure, technology, then you're poor because you've diminished the assets you had hidden below the ground and you don't have anything to show for it. So it seems to me that a first part of this should be to think in to say all the revenue or a lot of very large fraction should go into some form investment, human capital, infrastructure capital. But the other point that is very striking about the natural about countries with this natural resource curse with who had the good luck to have oil or is not only don't they grow as fast, they tend to have more inequality. You would think that with a natural resource, you would have less inequality. Why do I say that? If you tax work, you might not work as much. If you tax savings, you might not save. If you tax the oil, it can't get angry with you and say I'm going to go to another country. You know, it's there. And so by taxing it, I mean, in some things in Mexico has had the right philosophy, you said the natural resources belong to all the people. And therefore they're part of the country's patrimony, and they should be shared in a fair way in a way that reflects basic philosophical principles of how you share good fortune. Unfortunately, most countries don't do that. Most countries take this natural asset that belongs to all the people, and it goes to the elite. And that's why, you know, before Chavez arrived in Venezuela, two thirds of that country were in poverty, the richest country in terms of natural resources in Latin America. And yet the money was staying at the top and wasn't being shared. But Venezuela is nowhere near as bad as many of the other countries around the world with natural resources. So that's the third thing that I just would want to emphasize in the reforms. You have to think about not only stabilizing, but also making sure that the revenues are invested and particularly invested in people in ways that create more equality and particularly more equality of opportunity. And that will lead to more growth. Just to make sure one more, just a little anecdote story. I was talking to the Prime Minister of Norway last year, and she said that they invested a lot of their oil revenue on gender equality to make sure that women can enter the labor force, that they had childcare and women's education and all that. And she said that they now get more money from the returns to their investments in women than they do from oil. Now, you know, I don't know how you precisely do that calculation, but the spirit of that, I think, was one of the reasons why Norway is one of the countries that has not had an increase in inequality, that has managed to continue to grow very rapidly, and has now put aside in their stabilization fund, in their sovereign wealth fund, almost a trillion dollars for 5 million people. And I think through that sovereign wealth fund, they secure higher education for all Norwegians in, I don't know how many generations to come, which I think is the right approach. I couldn't agree more that the best investment, the wisest investment is people. And talking about people and human capital, I think we could say that probably the most underutilized asset in Latin America is human talent. And we've seen that Latin American 15-year-olds underperform in the OECD, actually over 50% of 15-year-olds in Latin America, of those countries that take the exam, perform so low that they receive scores of zero or one in the exam, which is basically you don't have basic capability of doing basic arithmetic or making a basic inference from a text. You just published a couple of years ago this new book on creating a learning society. What would you recommend to Latin American governments and societies to be better at learning? And also given the fact that the political cycle is usually short and the benefits from investing in education you are seeing in the long run, how can we incentivize governments to think more about the central importance of education? Yeah, I'm pretty glad you raised that question. One of the main thrusts of the point of my book, Creating a Learning Society, that will be coming out, I think in Spanish and not too long, is the following that if you look across history, for a thousand hundreds of years, standards of living were didn't change from over 25 hundred three thousand years. And then suddenly around 1750, 1800, 250 years ago, you see this flat curve suddenly bend up. And you ask the question, what changed in the world? And what changed, I think, is the we call the enlightenment, the idea that change was possible, but that it was only as a result of learning, of the scientific method, systematic studying and conveying of information, and creating and what I describe here in this book is creating a learning society, where you not only do you learn, but the information is transmitted, the knowledge is transmitted, transmitted throughout society. So the and I think this has really become even more important for all countries. As the pace of innovation increases, that, you know, we talked now about lifelong learning, that there's a formal period of education, but then the informal and the internet is for instance, change this a great deal. It used to be that, you know, we jokingly would say that we try to stuff as much knowledge in kids in the first 16, you know, 12 years, 16 years, 20 years of school. And then they hope that it stays relevant the rest of their life. Now we don't have to do that. What we have to teach them is how to access information, how to learn, how to make judgments, you know, how to how to evaluate the knowledge they're getting, and how to continue to learn. Because what is relevant today is not going to be relevant in 25 years. So you have to think of the whole society, not just one thing, but the whole society as a learning process, and recognize in every society, there are impediments to the flow of knowledge. And so that's why I call it creating a learning society. It wasn't just increasing the capabilities of individuals. That's what you do in the foremost schooling, but also create a framework for continuing to learning after and to make a framework in which people can continue to share knowledge, remove some of the impediments, open up next having an open society is very important to that. So that's sort of the basic framework for thinking about this. But core of that is having a good formal education system. And that's why the reforms here in Mexico on education reform just the beginning, but it's a big change. I think some people think that this may turn out to be the most important reform that has been happened. I'm one of those. I think the energy reform has received most of the attention, but I think in the long run, the educational reform will be probably the most transformational. Shifting a little bit to the trade arena because among the many topics that you have written about is trade. And right now there's a major trade agreement under negotiation among 12 countries of the Pacific Rim, including five in the Western Hemisphere, Canada, the US, Mexico, Chile and Peru. What are your thoughts about the potential of the Trans-Pacific Partnership of the impact, the cost, the benefits of this vast and ambitious trade agreement? Well, first, you have to understand this is not basically a trade agreement. They call it that. But one of the things that we teach in our school of public policy is whatever you see a bill or something, it's usually just the opposite. So if it's called a free trade agreement, it means it's a managed trade agreement. And it typically is not managed for the benefit of everybody in the world. It tends to be managed for particular interest. But it's not a trade agreement for another reason. Tariffs have already come down very low, accepting some very sensitive areas. I don't think you can expect the US to say we'll get rid of our agricultural subsidies. We'll get rid of our tariffs on our sensitive sectors, you know, because the special interest in those sectors are very strong. And when I've talked to people involved in negotiations, there doesn't seem to be much movement on the tariffs. You know, they'll be a little, but and they'll give them a lot of advertisement. But those are not what this is really about. There are two things that that have gotten me and I think a very large fraction of Americans, very three things that actually gotten us very concerned. The first is how the negotiations are going on. Total, you know, secrecy. Now, I'm going to make a few comments about what's in the agreement because how do I know? The wonderful thing about America is everything leaks. So WikiLeaks has has given us a lot. So we know what's in there. But the USTR is really undermining our democracy. You know, you have a Freedom of Information Act, we have a Freedom of Information Act. So they've responded to the efforts of the public to understand what's going on by labeling this classified, top secret, sort of like designing a nuclear bomb. Well, it is a nuclear bomb on our country maybe, but we're not allowed to see what they're negotiating because they've classified it. But as I say, fortunately, not only do we know it from WikiLeaks, actually, some of the trade negotiators from other countries on some of the issues. So we know it from the other side, what is being asked. There and so this process is very undemocratic. The some people get to see it and are actually at the almost at the bargaining table, but civil society, citizens groups are not even some congressmen have not been able to see it. So but the other the provisions, there are two provisions that are very that have have been the focus of opposition. And I want to emphasize this because some people think the opposition is anti trade. It's not it's not against trade. If it were a true trade agreement, they'd be for it. There are two provisions. One is the legal framework, this investor state dispute resolution mechanism, where a private investor can sue a government, Mexican government has been sued under Chapter 11. And the in a private, very expensive arbitration panel with arbitrators with all kinds of conflicts of interest, without any judicial process that United States and we've been telling working with other countries to establish a rule of law. A rule of law means processes of appellate precedence, openness and transparency. None of that is in this judicial process. And the result of this is that and you can be sued for a loss of expected profits in the future from a change in the regulation to protect health, safety, environment, any aspect even financial sector. So, you know, financial instability. So anything you can be sued on and you can be sued for the loss of profits that you expect to get in the future. Now this is not just a theoretical possibility. Let me just describe one example. Uruguay passed a regulation that said you have to label cigarettes packages with this is hazardous for your health. You have that regulation in Mexico. They didn't used to have that regulation in Uruguay, but they passed it. And they went a little bit graphic a little bit like you do in Mexico, but not like we do in the United States. They would show what a lungs look like if somebody smoked. And guess what? It discouraged people from smoking. That was as intent was to make people see what was happening. Philip Morris says, because people aren't buying cigarettes, we're losing money. We're not making our expected profits. So in Uruguay and in Australia, they're suing the government. They're suing the government because it's trying to stop people from killing their citizens. It's costing the government for health care. Because you know, when your lungs collapse, you go to the hospital and many of the people are poor in there. It's so expensive that Uruguay can't pay the legal costs. So fortunately, Mayor Bloomberg in New York and some other rich Americans have come to the help of Uruguay to protect it against an American company suing Uruguay to kill people in Uruguay with regulations that are the same as we have. So this is one example. But this would be pervasive. Now the United States says to American citizens, and you should know this, the US has only been sued 19 times or 13 times and has never lost. But Mexico and Canada, other countries have been sued and have lost. Why? Well, we have very expensive good lawyers. This is not a question of principle. Some of them may be here in the audience, but they're good lawyers. And you know, you can win. But what I tell the Americans now is, if we sign this agreement with Japan and with Europe, they have good lawyers too. And other countries are going to figure out, you know, there's no patent on the legal process. And so we will look in the United States, Mexico will lose. So I think this is, you know, this is a real step back. And in a judicial standard, I have fought the reason I feel so intensely is I have fought exactly the second provision. When I was in the White House, when I was chairman of the Congressional Accounting Advisors, I said, this is really bad for our society. If you want to have a debate about whether you should have regulation, let's have a debate, have Congress, you know, have the citizens engaged in it. But don't bury it in a treaty where if you change the regulation, you can get sued. So that's the one provision. The other one is intellectual property rights. You know, everybody recognizes intellectual property rights are important. But the question is getting the right balance, access to information versus incentive to innovation. And in the United States, we got that balance in what is called the Hatch-Waxman Act, but basically the result of that is that 87 percent of all drugs are generics, and that keeps the prices down. And the other 13 percent are the high priced drugs and they make the money to pay for the innovations. We had a balance. They are now trying to upset that balance. And to me, you know, I find it so shocking because the signature achievement of Obama has been Obamacare. The result of this will be that higher drug prices in all the countries of the world, the United States and all the countries, the countries with a public health care system, their budget is going to be busted, but those who don't have health insurance aren't going to be able to afford it. So, you know, and the interesting thing is there are some provisions that the USTR, our trade representative, are negotiating, which even the President opposes, I believe, that I've heard from. But USTR said this is just a negotiating position, but he's twisting arms so much that he'll probably win. And then the United States will be stuck with a provision that is even bad for the United States. Well, thank you for sharing your thoughts on the TPP, I think. By the way, you figured out I was against it. Yeah, of course. Slightly. Just slightly. I think it's a good time to open it up for questions from the audience. Let's take three. We have one here, one here, please. If you can bring the mic up front, please. Over the steel, congratulations. Daniela Miello from Accenture. What's your take on inequality and technology and being very brief, two schools of thought, one that is actually pretty proven that technology has bred growth and growth, of course, you know, great equality to some degree. But then, as you have recently saw, there are some examples of companies with a very little base of job growth that are creating astounding amounts of wealth. And, you know, taking technicalities aside, the Keystone XL pipeline, for instance, was an example that some people say that they have created net dozens of jobs rather than thousands. So how does this go with reducing inequality? What's your point of view on this? Yeah, that's a really good, should we take two more so that you can take the full round because we're running out of time. Yes, please. Thank you. Sorry. Go ahead. Go ahead and please make the questions short. Yes. Okay. So I've read you being quoted before that something along the lines that there's no magic bullet against inequality. But this question, basically, in your experience or in your studies, have you found that countries with economies or governments that are more centralized are more successful at reducing inequality and promoting growth? Say, I'm using the example perhaps of Chile and Mexico, which in practice is historically been more centralized, as opposed to countries with less centralized economies. Thank you. And we'll take the last one. Yes, please. The lady here. Thank you so much, Professor Stiglitz. My question is about any advice you could give to countries and companies that want to be involved in countries economic development through unleashing entrepreneurship and innovation and empowering women to be participants and active participants in entrepreneurship and innovation. Thank you. Okay. There's a famous joke in the United States goes something like forecasting is always difficult, especially at the future. And the the and you know, everybody talks about a two handed economist. So I'm going to give you a two handed answer. The fact is, I do think I am worried about the effect of changes of technology unless we do something about it on inequality. A lot of people say that yes, technological change has always destroyed jobs. The the develop the invention of the automobile destroy destroyed buggy whips and all kinds of things. But they say the that was followed by the cars. You had a car repair. You have all kinds of industries that grew. And those new jobs were more than the old jobs. We can't tell you what the new jobs are going to be. But the there's always going to be new jobs replacing old jobs. That's an important insight. But on the other hand, we've never been in a situation where we have machines that are not only stronger than most of us. Unless you're, you know, terminator five or one of their stronger than us. And I hate that they're I don't want to say they're brighter. But they can do some things much better than we can intellectually, you know, they can do calculations. You know, we used to just to give you an example, you know, when we were a kid and we watched trains go by, we would have a challenge to see whether we could add up 10 digit numbers as fast as the train would go by. It's no problem for a computer to do that. But for most kids, they can't do that. So that's the sort of intellectual challenge. We know that machines can process numbers, digital information a lot better than we can. So there are machines we've created that is always part of us. We've created machines that are stronger and can do many things better than us. And that means that they will replace many of us. And so I think there is a real risk of increasing unemployment. I think we can manage it in some sense. If you go back, you talked about historically that incomes have been the same for hundreds and hundreds of years until about 1800, King's wrote a very interesting essay about 75 years ago where he pointed out that until just not very long ago, most people had spent all of their life doing nothing but making the basic necessities of life, food, shelter, clothing. And then suddenly with this increase, they had more leisure time to the point now where most of us would work two or three or four hours a week for meeting the basic necessities. The question that King's posed is what are we going to do with the rest? And he was worried that we would not be able to spend our time in leisure. He hoped that they would be culture, it would be ideas, meetings like this. I don't know if he could envisage that, but people engaged in thinking. If you look around the world, Americans have actually wound up working more than they used to, and Europeans working less. So there's been different choices. If everybody tries to work more and more, then we have a real problem. If we have constructive, you know, leisure, I think we can, and sharing the growth that occurs, then our society can function. If we don't, I think we're going to have real problems. So I think that, I think there is a real chance that we're going to face a significant problem, and it's a matter of policy about how we address that, and societal evolution. One aspect of that is very important, is that companies advertise, it's the interest of people who make goods to advertise, encourage people to buy more goods. Much harder to get people to think about how to constructively use their leisure time. There's not a countervailing power. So that's something that one ought to think about. The second question was that, is there any difference between centralized and decentralized countries in the way they handle inequality? Well, the first thing I would emphasize, point out, is particularly in large countries, and Mexico is a large country for this purpose, there are large variations of wealth across the country in different regions. You have it north and south. United States has very large differences. So the issue isn't so much whether there is centralization versus decentralization, but there has to be some kind of regional redistribution. So there is no way in which the poor parts of the country can compete with the richest parts of the country, unless there is some kind of redistributive mechanism. But I actually think it has to go beyond that. If you look at where the American South was going, its income was much lower than the American North. They were not educating African Americans who were living there. It was a divide. We were two different countries, and it was only when the federal government said you have to have minimum wages, you have to we took very strong actions to try to bring the country together that that gap started being reduced. So I think that there needs to be some degree of centralization, not only in resources, but also in motivation in setting up national standards. Otherwise, it is often the case that you have local elites that run the that part of the world for their own interest, and very hard to get the kind of equality agenda that I think would make a difference. And I think that what I describe American South, I think, is true in many other parts of the world. One part of inequality that I haven't stressed is the inequalities that arise out of various kinds of discrimination, racial, ethnic, and gender discrimination. And, you know, things are better now than they were, but we have to, you know, when people say, oh, just market forces, I think that's wrong. The fact that we have societies with as much discrimination as we have shows that it's not just market forces that are shaping inequality in our society. Now, I see that very forcefully, you know, I grew up in Gary, Indiana, which was an industrial town. But as I was growing up, you couldn't ignore the racial discrimination that was just rampant there. And in 1960s, you know, that we had a strong march, young people said, you know, this is unconscionable, a century after the freeing of the slaves, that we still have this level of discrimination. We passed all kinds of civil rights laws and things like that. And now we're 65 years later, and we still have high levels of discrimination. Employment, housing, just, you know, we had this 2008 crisis. One aspect that came to light after the 2008 crisis was the banks were discriminating against African American and Hispanics. They, you know, people equally qualified for loans. If you're African American or Hispanic, you paid a higher interest rate. And they targeted African American Hispanics. And when I say that they, these are America's largest banks that we're doing this, they targeted them for predatory lending. So this shows you the battle that our societies have to face. You know, you're not going to solve it by legislation, but legislation helps move the dialogue. And I think it's really important, you know, I think the consciousness has been raised. And I think this episode of, in 2008, that kind of discrimination has re-focused the attention on this kind of discrimination. But I want to come back to the gender differences, because even though that we broke in the glass ceiling in many ways, we have a woman, one of my students is the head of the Federal Reserve. We have a woman who's head of the managing director, managing director of the IMF. They've been doing absolutely fantastic jobs. And that's changed, I think people's perceptions. There are many of us who think that we may not have had a crisis. If we had had women, more women in the financial institutions, they would have acted more responsibly, less recklessly and more morally. So I think there is a very big conference a couple of days ago sponsored by the Institute for New Economic Thinking, bringing women financial leaders together. But there's one more aspect that I think is really important, is that we have to structure our society to make it easier for people to balance work and life. And family lead policy, child care, they're a whole set of economic frameworks, legal frameworks that I think will facilitate the elimination of this long, long legacy of discrimination. Well, thank you very much, professor. I'm afraid we've run out of time, but thank you for really a fascinating discussion. We've covered a lot and, you know, inequality, you know, it's great to know that it's not inevitable. And I think we've covered economic growth, structural reforms, human capital, education, learning societies, TPP and trade and now a technology and gender. So it's been a fascinating ride with you. And thank you very much for your time and your insights.