Income Inequality and Economic Convergence in Turkey: A Spatial Effect Analysis

Julide Yildirim, Nadir Öcal and Süheyla Özyildirim
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Nadir Öcal: Department of Economics, Middle East Technical University, Ankara, Turkey, ocal@metu.edu.tr
Süheyla Özyildirim: Faculty of Business Administration, Bilkent University, Ankara, Turkey, suheyla@bilkent.edu.tr

International Regional Science Review, 2009, vol. 32, issue 2, 221-254

Abstract: Even though the convergence of regional per capita income has been a highly debated issue internationally, empirical evidence regarding Turkey is limited as well as contradictory. This article is an attempt to investigate regional income inequality and the convergence dynamics in Turkey for the time period 1987—2001. First, the Theil coefficient of concentration index is used to analyze the dispersion aspects of the convergence process. The geographically based decomposition of inequality suggests a strong correlation between the share of interregional inequality and spatial clustering. Then, we estimate convergence dynamics employing alternative spatial econometric methods. In addition to the global models, we also estimate local models taking spatial variations into account. Empirical analysis indicates that geographically weighted regression improves model fitting with better explanatory power. There is considerable variation in speed of convergence of provinces, which cannot be captured by the traditional beta convergence analysis.

Keywords: regional inequality; economic convergence; spatial analysis; Turkey (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (23)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:inrsre:v:32:y:2009:i:2:p:221-254

DOI: 10.1177/0160017608331250

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