Top Income Shares and Regional Inequality - Long-term patterns, 1900-2010

Abstract: After decades of convergence, income inequality has increased substantially in many European countries, as well as in the US. Additionally, a similar pattern has been observed for regional income disparities as well. This thesis examines the extent to which the top income shares and regional income disparities have moved in tandem on a national level during the 1900-2010 period, in both Europe and the US. While the results varied, there seems to have been a discernible pattern of co-movement in many countries, with a positive relationship between changes in income inequality and regional income disparities after 1980. However, some countries do not exhibit any such pattern, suggesting that there is no necessity for changes in top income shares to be accompanied by similar changes in regional income inequality.