Relationship Between Consumption and Personal Income Within a Hierarchically Structured Spatial System

Venera Maratovna Timiryanova (), Kasim Nazifovich Yusupov () and Ruzel Faritovich Salimyanov ()
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Venera Maratovna Timiryanova: Bashkir State University
Kasim Nazifovich Yusupov: Bashkir State University
Ruzel Faritovich Salimyanov: Ufa Federal Research Center of the RAS

Spatial Economics=Prostranstvennaya Ekonomika, 2020, issue 4, 91-112

Abstract: Differentiation in the level of socio-economic development of territories is largely manifested in both inter-regional and intra-regional differences in personal income and consumption of goods. In this regard the methods of hierarchical analysis (HLM, Hierarchical Linear Modeling) that make it possible to study variation at several levels taking into account both municipal and regional factors are acquiring special relevance. Along with hierarchical effects, neighborhood effects can be distinguished. This is possible due to the imposition of a spatial adjacency matrix on the data observing spatial interactions within the spatial-hierarchical models (HSAM, Hierarchical Spatial Autoregressive Modeling). The aim of the study is to better understand the relationship between consumption and personal income within a hierarchically structured and spatially oriented economic system. The analysis uses the data from 2319 municipalities (i.e. municipal districts or rayons) and urban districts (okrugs) in 84 constituent entities of the Russian Federation for 2018. It showed that 38.4% of the variation among municipalities in terms of sold foods volume is explained by regional factors. The developed hierarchical (two-level) model revealed the positive impact of the volume of social benefits and taxable personal income in the municipality, and the volume of per capita retail trade at the level of the Russian Federation constituent entities, on the volume of foods sold within municipalities, and substantiate the negative impact of the Gini index increase, as well as highlight the positive spatial effect

Keywords: personal income; consumption; hierarchical (multilevel) analysis; hierarchical spatial autoregressive modeling; regional differentiation; RF constituent entity (search for similar items in EconPapers)
JEL-codes: E21 R12 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:far:spaeco:y:2020:i:4:p:91-112

DOI: 10.14530/se.2020.4.091-112

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