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Convergence and Intercountry Inequality within Asia: A Combined Approach Using Decomposition Techniques and Transitional Dynamics Analysis

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  • Lafang Wang
  • Tsun Se Cheong
  • Yanrui Wu
  • Jianxin Wu

Abstract

This study provides a comprehensive analysis of intercountry inequality and convergence in Asia by using a combined approach that is based on decomposition techniques and transitional dynamics analysis. The research is divided into three stages. First, decomposition by regional subgroups is conducted to estimate the contributions of the interregional component and the five spatial groupings to overall inequality to reveal the development of inequality in Asia. Second, the technique of decomposition by income sources is used to evaluate the relative significance of the agricultural, industrial and service sectors to facilitate formulation of industrial policy for economic development. Finally, the present study analyses the evolution of regional inequality and assesses the possibility of convergence.

Suggested Citation

  • Lafang Wang & Tsun Se Cheong & Yanrui Wu & Jianxin Wu, 2019. "Convergence and Intercountry Inequality within Asia: A Combined Approach Using Decomposition Techniques and Transitional Dynamics Analysis," Asian Economic Journal, East Asian Economic Association, vol. 33(4), pages 341-362, December.
    • Handle: RePEc:bla:asiaec:v:33:y:2019:i:4:p:341-362
    DOI: 10.1111/asej.12192
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