According to the World Bank data for Nepal, the Gini-index, a measure of income disparity, stood at 38 in 1996 and increased to 47 in 2004—an increase of about 24 percent (INTERACTIVE GRAPH HERE). Joseph Stiglitz argued in his post on Real Clear Politics (CLICK HERE) that the "growing inequality in most countries of the world has meant that money has gone from those who would spend it to those who are so well off that, try as they might, they can't spend it all." This will then lead them to make risky ‘investments,’ which may fuel asset prices, giving rise to bubbles.
Does this answer the recent real estate and banking volatility in (Kathmandu) Nepal?
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