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The Rapid Rise in State Per Capita Income Inequality in the 1980's: Sources and Prospects

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  • Rowley, Thomas D.
  • Redman, John M.

Abstract

State per capita incomes diverged beginning in 1979, reversing a 50-year trend.. By 1989, State per capita income inequality, as measured by the coefficient of variation, had increased 41 percent from its 1979 value to its highest level in over 20 years. States in which real per capita income was greater than the national mean in 1979 and grew faster than the national mean accounted for most of the increase. Atlantic Coast States accounted for a large portion of the increase, as did States in which producer services accounted for a large share of total earnings. States dependent on hightechnology manufacturing, energy, farm, and traditional manufacturing accounted for less of the increase. Projections of future levels of inequality, based on alternative assumptions about per capita income growth, yield mixed results, ranging from a 10-percent decrease to a 56-percent increase in the coefficient of variation from 1989 to 1995.

Suggested Citation

  • Rowley, Thomas D. & Redman, John M., 1991. "The Rapid Rise in State Per Capita Income Inequality in the 1980's: Sources and Prospects," Staff Reports 278367, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uerssr:278367
    DOI: 10.22004/ag.econ.278367
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    References listed on IDEAS

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    1. Cletus C. Coughlin & Thomas B. Mandelbaum, 1988. "Why have state per capita incomes diverged recently?," Review, Federal Reserve Bank of St. Louis, issue Sep, pages 24-36.
    2. Cletus C. Coughlin & Thomas B. Mandelbaum, 1989. "Have federal spending and taxation contributed to the divergence of state per capita incomes in the 1980s?," Review, Federal Reserve Bank of St. Louis, issue Jul, pages 29-42.
    3. James P. Miller, 1989. "The Product Cycle and High Technology Industry in Nonmetropolitan Areas, 1976-1980," The Review of Regional Studies, Southern Regional Science Association, vol. 19(1), pages 1-12, Winter.
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    2. Shahdad Naghshpour & Bruno S. Sergi, 2009. "Absolute beta convergence in liberated communist countries of Europe," International Journal of Economic Policy in Emerging Economies, Inderscience Enterprises Ltd, vol. 2(1), pages 63-75.
    3. Edward Nissan, 1992. "Convergence Of Regional And State Rates Of Growth Of Income, Employment, And Population: 1969-2000," The Review of Regional Studies, Southern Regional Science Association, vol. 22(3), pages 261-276, Winter.
    4. Mohamed Abdel-Ghany & Stephen Thoma, 2002. "Distribution of Household Income in America: Effects of Source of Income, Inflation, and Cost of Living Differentials," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 60(1), pages 281-297, December.
    5. Carlino, Gerald A. & Mills, Leonard, 1996. "Testing neoclassical convergence in regional incomes and earnings," Regional Science and Urban Economics, Elsevier, vol. 26(6), pages 565-590, December.
    6. Ward, William A. & Hite, James C., 1999. "Asset Fixity, Asset Specificity And Regional Economic Change: Hypothesis And Implications," Working Papers 18807, Clemson University, Department of Agricultural and Applied Economics.
    7. Kusmin, Lorin D., 1994. "Factors Associated with the Growth of Local and Regional Economies: A Review of Selected Empirical Literature," Staff Reports 278733, United States Department of Agriculture, Economic Research Service.
    8. David W. Marcouiller & Dean F. Schreiner & David K. Lewis, 1996. "The Impact Of Forest Land Use On Regional Value Added," The Review of Regional Studies, Southern Regional Science Association, vol. 26(2), pages 211-233, Fall.

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