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Earnings convergence in UK counties: a distribution dynamics approach

  • Paul Bishop
  • Peter Gripaios
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    This study applies a distribution dynamics approach to examining the evolution of average earnings of UK counties. An analysis of both transition probability matrices and stochastic kernels suggests considerable persistence in the overall distribution rather than economic convergence. However, there is evidence of a large number of counties congregating at the lower end of the distribution reflecting some downward mobility from the middle. Spatial effects are also important with counties in the South East appearing to gravitate towards the upper end of the distribution. The analysis reveals a more complex pattern of dynamics than is typically apparent from β regression approaches.

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    Article provided by Taylor & Francis Journals in its journal Applied Economics Letters.

    Volume (Year): 13 (2006)
    Issue (Month): 1 ()
    Pages: 29-33

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    Handle: RePEc:taf:apeclt:v:13:y:2006:i:1:p:29-33
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    1. Magrini, Stefano, 1999. "The evolution of income disparities among the regions of the European Union," Regional Science and Urban Economics, Elsevier, vol. 29(2), pages 257-281, March.
    2. Damien Neven & Claudine Gouymte, 1995. "Regional Convergence in the European Community," Journal of Common Market Studies, Wiley Blackwell, vol. 33(1), pages 47-65, 03.
    3. Bode, Eckhardt & Bickenbach, Frank, 2002. "Markov or not Markov - this should be a question," ERSA conference papers ersa02p024, European Regional Science Association.
    4. Andrew Henley, 2005. "On regional growth convergence in Great Britain," Regional Studies, Taylor & Francis Journals, vol. 39(9), pages 1245-1260.
    5. G. E. Boyle & T. G. McCARTHY, 1999. "Simple measures of convergence in per capita GDP: a note on some further international evidence," Applied Economics Letters, Taylor & Francis Journals, vol. 6(6), pages 343-347.
    6. Helmut Hofer & Andreas Worgotter, 1997. "Regional Per Capita Income Convergence in Austria," Regional Studies, Taylor & Francis Journals, vol. 31(1), pages 1-12.
    7. Cameron, Gavin & Muellbauer, John, 2000. "Earnings Biases in the United Kingdom Regional Accounts: Some Economic Policy and Research Implications," Economic Journal, Royal Economic Society, vol. 110(464), pages F412-29, June.
    8. Paul Cheshire, 2000. "Endogenous Processes in European Regional Growth: Convergence and Policy," Growth and Change, Wiley Blackwell, vol. 31(4), pages 455-479.
    9. Fingleton, Bernard, 1997. "Specification and Testing of Markov Chain Models: An Application to Convergence in the European Union," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 59(3), pages 385-403, August.
    10. repec:cep:stiecm:/1993/265 is not listed on IDEAS
    11. Peter Gripaios & Ben Gripaios & Sarah Keast & Nick Wiseman, 1999. "Differences in household income per head over the UK trade cycle; a comment," Applied Economics Letters, Taylor & Francis Journals, vol. 6(8), pages 471-476.
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