Economic Growth and Change
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Economic Growth and Change

National and Regional Patterns of Convergence and Divergence

Edited by John Adams and Francesco Pigliaru

The pursuit of economic growth is at the top of every nation’s policy agenda at the end of the 20th century. This authoritative and comprehensive book goes beyond the narrowly-based convergence model of economic growth by considering global, national and regional patterns of growth from a comparative perspective.
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Chapter 7: Per capita earnings inequality across regions and states in the United States: trends, sources determinants

Andrew M. Sum and Walter N. Fogg


Page 183  7. Per capita earnings inequality across regions and states in the United States: trends, sources, determinants  Andrew M. Sum and Walter N. Fogg  INTRODUCTION  In the previous chapter, trends in inequality in per capita personal incomes across regions and states in the US were identified and assessed. Findings revealed a  marked decline in inequality among regions and states over the entire 1929–96 period, a trend toward convergence in all decades except the 1980s, and a renewal of  convergence trends in the 1990s. Per capita market incomes (wages, salaries, property incomes) remain more unequally distributed than per capita personal incomes  which include government transfers, and national and state personal tax policies have a further moderating effect on state income inequality. Although inequalities in  property income do contribute to remaining income inequalities across states, the bulk of the differences is attributable to earnings from employment.1  This chapter is designed to identify and analyse inequality in per capita earnings from employment across regions and states in the US over the 1979–95 period. The  analysis will begin with an examination of the relative importance of earnings as a source of the personal incomes of state residents and analyse the degree of inequality  in per capita earnings across states over the 1989–96 period. This will be followed by an analysis of the economic, labour market and demographic forces influencing  the per capita earnings of state residents and the contribution of each of these sources to remaining inequality in per capita...

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