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A Spatial Analysis of Poverty and Income Inequality in the Appalachian Region

Author

Listed:
  • Sudishka Joshi

    (Division of Resource Management, West Virginia University)

  • Tesfa Gebremedhin

    (Division of Resource Management, West Virginia University)

Abstract

The Appalachian Region has made progress in the various measures of development but still lags behind other national counterparts. Understanding the relationship between poverty and income inequality is important to evaluate how a development strategy would benefit the region. This paper presents a spatial simultaneous equations approach to determine the relationship between poverty and income inequality. Cross sectional county level data from 1990 and 2000 for the 420 counties in the Appalachian Region are used to examine the determinants of poverty and income inequality. The empirical results suggest that poverty and income inequality are inversely related. If the policy objective is to alleviate poverty, then considering reducing income inequality at the same time, may prove to render ineffective conclusions. The result findings also suggest that the income inequality in the Appalachian Region may actually contribute to its economic growth and to poverty reduction in the Region.

Suggested Citation

  • Sudishka Joshi & Tesfa Gebremedhin, 2010. "A Spatial Analysis of Poverty and Income Inequality in the Appalachian Region," Working Papers Working Paper 2010-15, Regional Research Institute, West Virginia University.
    • Handle: RePEc:rri:wpaper:2010wp15
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    File URL: https://researchrepository.wvu.edu/rri_pubs/51/
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    References listed on IDEAS

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    More about this item

    Keywords

    poverty rate; income inequality; gini coefficient; spatial durbin model;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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