Factor decomposition of income inequality change : Japan's regional income disparity from 1955 to 1998
We propose a method for the decomposition of inequality changes based on panel data regression. The method is an efficient way to quantify the contributions of variables to changes of the Theil T index while satisfying the property of uniform addition. We illustrate the method using prefectural data from Japan for the period 1955 to 1998. Japan experienced a diminishing of regional income disparity during the years of high economic growth from 1955 to 1973. After estimating production functions using panel data for prefectures in Japan, we apply the new decomposition approach to identify each production factorâ€™s contributions to the changes of per capita income inequality among prefectures. The decomposition results show that total factor productivity (residual) growth, population change (migration), and public capital stock growth contributed to the diminishing of per capita income disparity.
|Date of creation:||Mar 2013|
|Date of revision:|
|Publication status:||Published in IDE Discussion Paper. No. 400. 2013.3|
|Contact details of provider:|| Postal: 3-2-2 Wakaba, Mihama-ku, Chiba-shi, Chiba 261-8545|
Web page: http://www.ide.go.jp/
More information through EDIRC
|Order Information:|| Postal: Publication Office, IDE 3-2-2 Wakaba, Mihama-ku, Chiba-shi, Chiba 261-8545 JAPAN|
Web: http://www.ide.go.jp/English/Publish/Order Email:
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kai-yuen Tsui, 2007. "Forces Shaping China'S Interprovincial Inequality," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 53(1), pages 60-92, 03.
- Mercedes Sastre & Alain Trannoy, 2002.
"Shapley inequality decomposition by factor components: Some methodological issues,"
Journal of Economics,
Springer, vol. 77(1), pages 51-89, December.
- Mercedes Sastre & Alain Trannoy, 2002. "Shapley inequality decomposition by factor components: Some methodological issues," Journal of Economics, Springer, vol. 9(1), pages 51-89, December.
- Bourguignon, Francois & Fournier, M & Gurgand, M, 2001. "Fast Development with a Stable Income Distribution: Taiwan, 1979-94," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 47(2), pages 139-63, June.
- Perotti, Roberto, 1996. "Growth, Income Distribution, and Democracy: What the Data Say," Journal of Economic Growth, Springer, vol. 1(2), pages 149-87, June.
- Kawaguchi, Daiji & Ohtake, Fumio & Tamada, Keiko, 2009. "The productivity of public capital: Evidence from Japan's 1994 electoral reform," Journal of the Japanese and International Economies, Elsevier, vol. 23(3), pages 332-343, September.
- Toshiaki Tachibanaki, 2006. "Inequality And Poverty In Japan," The Japanese Economic Review, Japanese Economic Association, vol. 57(1), pages 1-27.
- Guanghua Wan & Zhangyue Zhou, 2005.
"Income Inequality in Rural China: Regression-based Decomposition Using Household Data,"
Review of Development Economics,
Wiley Blackwell, vol. 9(1), pages 107-120, 02.
- Wan, Guanghua & Zhou, Zhangyue, 2004. "Income Inequality in Rural China: Regression-based Decomposition Using Household Data," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- Wan, Guanghua, 2004. "Accounting for income inequality in rural China: a regression-based approach," Journal of Comparative Economics, Elsevier, vol. 32(2), pages 348-363, June.
- Norihiko Yamano & Toru Ohkawara, 2000. "The Regional Allocation of Public Investment: Efficiency or Equity?," Journal of Regional Science, Wiley Blackwell, vol. 40(2), pages 205-229.
- "Fukao, Kyoji" & "Yue, Ximing", 2000. "Regional Factor Inputs and Convergence in Japan―How Much Can We Apply Closed Economy Neoclassical Growth Models?―," Economic Review, Hitotsubashi University, vol. 51(2), pages 136-151, April.
- Shioji, Etsuro, 2001. "Public Capital and Economic Growth: A Convergence Approach," Journal of Economic Growth, Springer, vol. 6(3), pages 205-27, September.
When requesting a correction, please mention this item's handle: RePEc:jet:dpaper:dpaper400. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Marie Kobayashi)
If references are entirely missing, you can add them using this form.