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Regional Income Inequality in the Post-War Japan

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  • Mitsuhiko Kataoka
  • Takahiro Akita

Abstract

In his seminal work on national development and regional inequality, Williamson (1965) predicts that regional income inequality will pass through three distinct phases as a nation moves through the early development stages to maturity. In the early stages of economic development, regional income inequality will increase, largely because of the disequilibrating effects of factor mobility. This will be followed by a period of stability, characterized by a relatively high level of inequality between regions. Finally, a lessening of regional inequality will set in as the national economy matures and equilibrating forces take effect. This overall process, if plotted against national economic development, will result in a bell-shaped or inverted U-shapes curve. The early stages of development are also associated with rapid urbanization, though with a shift toward population dispersion as the economy matures. Other stylized facts in the process of development include industrialization, demographic transition, and changing inequality of income among population subgroups (Alonso, 1980). The concentration of population in and around large cities is usually accompanied by an increase in regional income inequality. Some researchers have argued that this population concentration and concurrent increase in regional inequality does not impede economic development, and may in fact favor it. Nonetheless, many national governments have introduced policies of balanced regional development. The main objective of this paper is to measure regional income inequality in the post-war Japan using Williamson?s weighted coefficient of variation. Based on prefectural population and GDP data, it investigates longer-term trends in regional income inequality. A sectoral decomposition analysis is also performed to examine the extent to which each industrial sector contributes to the overall weighted coefficient of variation. We hope to gain a deeper understanding of the relationship between national development, industrialization, and regional inequalities in the post-war Japan.

Suggested Citation

  • Mitsuhiko Kataoka & Takahiro Akita, 2003. "Regional Income Inequality in the Post-War Japan," ERSA conference papers ersa03p480, European Regional Science Association.
    • Handle: RePEc:wiw:wiwrsa:ersa03p480
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    File URL: https://www-sre.wu.ac.at/ersa/ersaconfs/ersa03/cdrom/papers/480.pdf
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    References listed on IDEAS

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    1. Servet Mutlu, 1991. "Regional Disparities, Industry and Government Policy in Japan," Development and Change, International Institute of Social Studies, vol. 22(3), pages 547-586, July.
    2. William Alonso, 1980. "Five Bell Shapes In Development," Papers in Regional Science, Wiley Blackwell, vol. 45(1), pages 5-16, January.
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    Cited by:

    1. Eleonora Cutrini, 2005. "The Balassa Index meets the Theil Index - a Decomposition Methodology for Location Studies," ERSA conference papers ersa05p123, European Regional Science Association.
    2. Reuter & Ulrich, 2004. "The Effects of Intraregional Disparities on Regional Development in China: Inequality Decomposition and Panel-Data Analysis," Econometric Society 2004 Far Eastern Meetings 716, Econometric Society.
    3. Yue Ma, 2008. "Incomplete financial market and the sequence of international trade liberalization," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 13(1), pages 108-117.
    4. Branko Milanovic, 2004. "Half a World: Regional inequality in five great federations," Urban/Regional 0404002, University Library of Munich, Germany.
    5. Chhavi Tiwari & Sankalpa Bhattacharjee & Debkumar Chakrabarti, 2020. "Investigating Regional Inequalities in India: Are Indian Districts Converging?," Journal of International Development, John Wiley & Sons, Ltd., vol. 32(5), pages 684-716, July.
    6. Rosés, Joan Ramón & Martínez-Galarraga, Julio & Tirado, Daniel A., 2010. "The upswing of regional income inequality in Spain (1860-1930)," Explorations in Economic History, Elsevier, vol. 47(2), pages 244-257, April.
    7. Mitsuhiko Kataoka, 2014. "Trends in the regional allocation of public investment in the post-bubble Japanese economy," Letters in Spatial and Resource Sciences, Springer, vol. 7(3), pages 205-212, October.
    8. Paul, Saumik & Fukao, Kyoji, 2017. "The Role of Structural Transformation in Regional Productivity Growth and Convergence in Japan: 1874 - 2008," CEI Working Paper Series 2016-12, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    9. Julio Mart�nez-Galarraga & Joan R. Ros�s & Daniel A. Tirado, 2015. "The Long-Term Patterns of Regional Income Inequality in Spain, 1860-2000," Regional Studies, Taylor & Francis Journals, vol. 49(4), pages 502-517, April.
    10. Fukao, Kyoji & 深尾, 京司 & Paul, Saumik, 2017. "The Role of Structural Transformation in Regional Convergence in Japan: 1874-2008," SSPJ Discussion Paper Series DP17-001, Service Sector Productivity in Japan: Determinants and Policies, Institute of Economic Research, Hitotsubashi University.
    11. Takahiro Akita & Sachiko Miyata, 2006. "Geographic Concentration of Manufacturing Industries in Japan: Testing Hypotheses of new Economic Geography," Working Papers EMS_2006_04, Research Institute, International University of Japan.
    12. Akita, Takahiro & Kawamura, Kazumi, 2002. "Regional income inequality in China and Indonesia: A comparative analysis," ERSA conference papers ersa02p432, European Regional Science Association.
    13. José Aguilar Retureta, 2016. "Explaining regional inequality from the periphery: The mexican case, 1900-2000," Documentos de Trabajo (DT-AEHE) 1608, Asociación Española de Historia Económica.
    14. Takahiro Akita & Sachiko Miyata, 2005. "Theories of New Economic Geography and Geographical Concentration of Manufacturing Industries in Japan," ERSA conference papers ersa05p195, European Regional Science Association.
    15. Fukao, Kyoji & Paul, Saumik, 2017. "The Role of Structural Transformation in Regional Convergence in Japan: 1874-2008," Discussion Paper Series 665, Institute of Economic Research, Hitotsubashi University.

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