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Growth of regional economy and income inequality: county-level evidence from Florida, USA

  • Jongsup Kim
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    The purpose of this paper is to find the homogeneous groups and growth factors of Florida's counties through factor analysis and cluster analysis from data sets from 1979 and 2000 and to grasp the relationship between income inequality and growth by cluster using the derived growth factors. The numbers of factors divided through factor analysis were three, and six groups were obtained from cluster analysis. County-level evidence of this paper indicates that GI_DI and SIN have a strong effect and are statistically significant to the growth rate. Results for income inequality by county and region indicate significant differences between counties, including counties where agriculture accomplishes the primary main function. Therefore, government should adopt the following policies: minimum wage, unemployment insurance, local or state tax policies, income support programmes, and tax reform.

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    File URL: http://www.tandfonline.com/doi/abs/10.1080/0003684042000174065
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    Article provided by Taylor & Francis Journals in its journal Applied Economics.

    Volume (Year): 36 (2004)
    Issue (Month): 2 ()
    Pages: 173-183

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    Handle: RePEc:taf:applec:v:36:y:2004:i:2:p:173-183
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    1. Galor, Oded & Tsiddon, Daniel, 1997. "Technological Progress, Mobility, and Economic Growth," American Economic Review, American Economic Association, vol. 87(3), pages 363-82, June.
    2. Saint-Paul, G. & Verdier, T., 1991. "Education, Democracy and growth," DELTA Working Papers 91-27, DELTA (Ecole normale supérieure).
    3. Galor, Oded & Zeira, Joseph, 1993. "Income Distribution and Macroeconomics," Review of Economic Studies, Wiley Blackwell, vol. 60(1), pages 35-52, January.
    4. Alberto Alesina & Dani Rodrik, 1991. "Distributive Politics and Economic Growth," NBER Working Papers 3668, National Bureau of Economic Research, Inc.
    5. Persson, T. & Tabellini, G., 1993. "Is Inequality Harmful for Growth," Papers 537, Stockholm - International Economic Studies.
    6. Dasgupta, Partha & Sen, Amartya & Starrett, David, 1973. "Notes on the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 6(2), pages 180-187, April.
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