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Mapping Regional Personal Income Distribution in Western Europe: Income Per Capita and Inequality

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Abstract

Past studies of regional economic disparities in the EU are fundamentally based on the information provided by macroeconomic variables. This paper considers regional disparities using microeconomic data aggregated at the regional level, paying attention not only to the average, but also to the inequality levels of individual incomes within regions. It maps regional personal income distribution in Western Europe, using data from the European Community Household Panel (ECHP) data survey covering more than 100,000 individuals, for 102 regions, and over the period 1995–2000. The Exploratory Spatial Data Analysis on income per capita and inequality reveals a rich set of findings. (1) There is a strong U-shaped relationship between income per capita and inequality which is highly robust across inequality measurements. (2) 80 percent of the income inequality in Europe takes place among individuals living in the same region. (3) Regions with similar income conditions tend to cluster, not only within national borders, but also across nations. (4) There is a North-South and an urban-rural divide where northern regions and city-regions have the highest economic development, as well as the lowest levels of inequality.

Suggested Citation

  • Andrés Rodríguez-Pose & Vassilis Tselios, 2009. "Mapping Regional Personal Income Distribution in Western Europe: Income Per Capita and Inequality," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 59(1), pages 41-70, January.
  • Handle: RePEc:fau:fauart:v:59:y:2009:i:1:p:41-70
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    Cited by:

    1. Andrés Rodríguez‐Pose & Vassilis Tselios, 2009. "Education And Income Inequality In The Regions Of The European Union," Journal of Regional Science, Wiley Blackwell, vol. 49(3), pages 411-437, August.
    2. Riccardo Pozzi & Rosalba Rombaldoni & Edgar J.Sanchez Carrera, 2018. "Inequalities, spatial disparities and agglomeration of economic activity in European regions," Working Papers 1805, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2018.
    3. Wenze Yue & Yuntang Zhang & Xinyue Ye & Yeqing Cheng & Mark R. Leipnik, 2014. "Dynamics of Multi-Scale Intra-Provincial Regional Inequality in Zhejiang, China," Sustainability, MDPI, Open Access Journal, vol. 6(9), pages 1-22, August.
    4. Betsy Donald & Mia Gray & Centre for Business Research, 2018. "The Double Crisis: In What Sense A Regional Problem?," Working Papers wp507, Centre for Business Research, University of Cambridge.
    5. Neil Lee & Andrés Rodríguez-Pose, 2013. "Innovation and spatial inequality in Europe and USA," Journal of Economic Geography, Oxford University Press, vol. 13(1), pages 1-22, January.
    6. Kaja Bonesmo Fredriksen, 2012. "Income Inequality in the European Union," OECD Economics Department Working Papers 952, OECD Publishing.
    7. Manoel Bittencourt & Shinhye Chang & Rangan Gupta & Stephen M. Miller, 2018. "Does Financial Development Affect Income Inequality in the U.S. States? A Panel Data Analysis," Working Papers 201803, University of Pretoria, Department of Economics.
    8. Emmanouil Tranos & Peter Nijkamp, 2014. "Digital infrastructure and physical proximity," Chapters, in: André Torre & Frédéric Wallet (ed.), Regional Development and Proximity Relations, chapter 8, pages 267-290, Edward Elgar Publishing.
    9. Jyotirmayee Kar, 2012. "Income Inequality in Some Major European Union Economies a Discriminant Analysis," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 12(4), pages 117-128.

    More about this item

    Keywords

    income inequality; regions; Exploratory Spatial Data Analysis; Europe; urbanization; EU North-South divide;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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