How do regional price levels affect income inequality? Household-level evidence from 21 countries

Arbeitspapier

Regional differences in prices levels are substantial in many countries, but little is known about how important they are for income inequality and relative poverty. To bridge this gap, we provide new evidence on the basis of the best available data and a novel two-step approach. First, we collect the largest cross-country dataset of regional price level estimates from 12 countries and use it to predict regional price levels in other countries. We then combine all these regional prices levels with household-level data from the Luxembourg Income Study, which gives us results for a final sample of 21 countries. We find that for some countries Gini coefficients and headcount poverty ratios are statistically significantly different when adjusted for regional price levels. For example, we show that adjusting for regional price levels would lower the Gini coefficients by 2% for Italy, 3% for Columbia and by 4% for Georgia, while it would increase the headcount poverty ratio by 6% for France and by 7% for Ireland. We conclude that regional price levels affect income inequality to a varying extent and should be taken into account by policy makers and in future research.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: LIS Working Paper Series ; No. 752

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Equity, Justice, Inequality, and Other Normative Criteria and Measurement ; Economic Development: Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure ; Regional Economic Activity: Growth, Development, Environmental Issues, and Changes ; Regional Development Planning and Policy
• Thema: income inequality ; relative poverty ; regional price levels ; regional purchasing power parities ; Luxembourg Income Study

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Janský, Petr ; Šedivý, Marek
• Ereignis: Veröffentlichung
• (wer): Luxembourg Income Study (LIS)
• (wo): Luxembourg
• (wann): 2018

Weitere Informationen

• Handle: http://hdl.handle.net/10419/203038
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ