Location and regional income disparity dynamics: The Brazilian case
AbstractIn this note we provide evidence on the importance of location for the growth of per capita income of Brazilian states over the period 1985-2001. The study presents strong evidence of spatial dependence, and that regional inequality reduction occurred simultaneously with increasing spatial autocorrelation. The analysis of local indicators of spatial association confirmed that conclusion, showing the existence of two geographical clusters, one of low income states in the Northeast and North regions, and another of rich states in the Southeast and South regions. The low value for the convergence coefficient, in conjunction with the strong influence of shocks in the residuals, indicate the existence of a very sensible dynamic pattern of convergence across Brazilian states, which helps explaining the well documented persistence in regional income disparities in Brazil. After conditioning on other important variables that could affect growth, however, spatial dependence disappears. We have thus identified two potential channels through which the strong spatial dependence in the process of convergence of per capita income of Brazilian states occurs. Copyright (c) 2006 the author(s). Journal compilation (c) 2006 RSAI.
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal Papers in Regional Science.
Volume (Year): 85 (2006)
Issue (Month): 4 (November)
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=1056-8190
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- Jiangang Peng & Nicolaas Groenewold & Jing He & Zhangfei Li & Yu Yi, 2008. "Regional Finance and Regional Disparities in China," Economics Discussion / Working Papers 08-02, The University of Western Australia, Department of Economics.
- Habibullah, M.S. & Dayang-Afizzah, A.M., 2008. "Bordering neighbours: Testing for border effect on Malaysia's northern states and Southern Thailand," MPRA Paper 12103, University Library of Munich, Germany.
- Valente J. Matlaba & Mark Holmes & Philip McCann & Jacques Poot, 2012. "Agglomeration Externalities and 1981-2006 Regional Growth in Brazil," Working Papers in Economics 12/07, University of Waikato, Department of Economics.
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