Interregional Inequality Dynamics in Mexico
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1 in Mexico Sergio J. Rey 1 Myrna L. Sastré Gutiérrez 1,2 1 Regional Analysis Laboratory (REGAL) Department of Geography San Diego State University 2 Program of Economic Science Universidad Autonoma of Baja Caifornia 54th Annual North American Meetings of RSAI
2 Outline 1 Introduction Motivation Key Questions
3 Outline 1 Introduction Motivation Key Questions 2 Regional Inequality Revisited Design Global Inequality Dynamics
4 Outline 1 Introduction Motivation Key Questions 2 Regional Inequality Revisited Design Global Inequality Dynamics 3 Summary Findings and Directions
5 Motivation Outline 1 Introduction Motivation Key Questions 2 Regional Inequality Revisited Design Global Inequality Dynamics 3 Summary Findings and Directions
6 Motivation Relative GRP 1940 and 2000
7 Motivation Quintile Maps: Snapshot Limitations Spatial Distribution
8 Motivation Quintile Maps: Snapshot Limitations Spatial Distribution Multimodality?
9 Motivation Quintile Maps: Snapshot Limitations Spatial Distribution Multimodality? Mixing?
10 Motivation Quintile Maps: Snapshot Limitations Spatial Distribution Multimodality? Mixing? Intraclass mobility?
11 Motivation Quintile Maps: Snapshot Limitations Spatial Distribution Multimodality? Mixing? Intraclass mobility? How are A and B related in geographic space?
12 Motivation Role of Spatial Clustering Competitive Clustering Cooperative Clustering
13 Motivation Spatial Dependence and Inequality
14 Motivation Motivation Theoretical Evolution of inequality in Mexico NAFTA and Integration Methodological Inequality Dynamic Metrics Incorporation of Spatial Dimension
15 Key Questions Outline 1 Introduction Motivation Key Questions 2 Regional Inequality Revisited Design Global Inequality Dynamics 3 Summary Findings and Directions
16 Key Questions Focus Key Questions 1 The implications of spatial units and aggregation on the measure of interregional inequality, 2 The relevance of inferential methods in defining a spatial structure, 3 The time profile of the relationship between interregional inequality and spatial dependence.
17 Key Questions Existing Studies Convergence Focus Hanson (1998) - Employment growth Esquivel (1999) Aroca (2003) Hanson (2003) Chiquiar (2005) Inequality Focus Arroyo (2001) Aroca (2005)
18 Design Outline 1 Introduction Motivation Key Questions 2 Regional Inequality Revisited Design Global Inequality Dynamics 3 Summary Findings and Directions
19 Design Questions Inequality Dynamics Has the level of global regional inequality in Mexico changed over the period? 1 How sensitive are inferences about interregional inequality to choice of regionalization scheme? 2 Has the level of interregional inequality changed over time?
20 Design Regional Definitions
21 Design Regionalization Schemes Minimum Average Maximum Scheme Regions States States States inegi inegi hanson hanson esquivel
22 Global Inequality Dynamics Outline 1 Introduction Motivation Key Questions 2 Regional Inequality Revisited Design Global Inequality Dynamics 3 Summary Findings and Directions
23 Global Inequality Dynamics Global Inequality Theil Index n T = s i log(ns i ) (1) i=1 where n is the number of regions, y i is per capita income in region i, and: n s i = y i / y i. (2) Question 1 H o : T t = T t+1 (3) i=1
24 Global Inequality Dynamics Relative GRP 1940 and 2000
25 Global Inequality Dynamics Global Inequality Dynamics Question 1 H o : T t = T t+1 (4) δt = T t T t+1 (5) Sampling Distribution of δt Asymptotic distributions (Maasoumi 1997) Temporal Dependence (Zheng and Cushing 2001) Spatial Dependence (Rey 2004)
26 Global Inequality Dynamics Sampling Distribution of δt Random labeling in time t t+1 t t+1 y 1,t y 1,t+1 y 1,t+1 y 1,t y 2,t y 2,t+1 y 2,t y 2,t+1 y 3,t y 3,t+1 y 3,t y 3,t+1 y 4,t y 4,t+1 y 4,t+1 y 4,t.... y n,t y n,t+1 y n,t y n,t+1 δt on observed (cols 1-2) δt on randomized (cols 3-4) Empirical distribution from repeated randomized columns Preserves some spatial structure (t is randomized not i)
27 Global Inequality Dynamics Inequality Dynamics above diagonal δ c,r = T c T r diagonal T r below diagonal p(δ c,r H o )
28 Outline 1 Introduction Motivation Key Questions 2 Regional Inequality Revisited Design Global Inequality Dynamics 3 Summary Findings and Directions
29 Interregional Inequality Theil Decomposition ω T = s g log(n/n g s g ) + g=1 ω s g s i,g log(n g s i,g ) (6) g=1 where n g is the number of observations in group g (and g n g = n), s g = i g y i,g/ n i y i is the share of total income accounted for by group g, and s i,g = y i,g / n g i=1 y i,g is region i s share of group g s income. The first term on the right hand side of (6) is the between-group component of inequality, while the second term is the within-group component of inequality. In other words: T = T B + T W. (7) i g
30
31 Inference on Interregional Decomposition Spatial Permutations 1 Calculate decomposition: T = TW + T B (8) 2 Randomly reassign incomes to new locations 3 Calculate decomposition for permutated map: T P = TW P + T B P (9) 4 Repeat steps 2 and 3, K times.
32 Interregional Inequality Differences: 1940 inegi inegi2 hanson98 hanson03 esquivel99 inegi inegi hanson hanson esquivel Above diagonal: δ = IR c IR r Diagonal: IR r Below diagonal: p(δ H 0 : IR c = IR r )
33 Interregional Inequality Differences: 1950 inegi inegi2 hanson98 hanson03 esquivel99 inegi inegi hanson hanson esquivel Above diagonal: δ = IR c IR r Diagonal: IR r Below diagonal: p(δ H 0 : IR c = IR r )
34 Interregional Inequality Differences: 1960 inegi inegi2 hanson98 hanson03 esquivel99 inegi inegi hanson hanson esquivel Above diagonal: δ = IR c IR r Diagonal: IR r Below diagonal: p(δ H 0 : IR c = IR r )
35 Interregional Inequality Differences: 1970 inegi inegi2 hanson98 hanson03 esquivel99 inegi inegi hanson hanson esquivel Above diagonal: δ = IR c IR r Diagonal: IR r Below diagonal: p(δ H 0 : IR c = IR r )
36 Interregional Inequality Differences: 1980 inegi inegi2 hanson98 hanson03 esquivel99 inegi inegi hanson hanson esquivel Above diagonal: δ = IR c IR r Diagonal: IR r Below diagonal: p(δ H 0 : IR c = IR r )
37 Interregional Inequality Differences: 1990 inegi inegi2 hanson98 hanson03 esquivel99 inegi inegi hanson hanson esquivel Above diagonal: δ = IR c IR r Diagonal: IR r Below diagonal: p(δ H 0 : IR c = IR r )
38 Interregional Inequality Differences: 2000 inegi inegi2 hanson98 hanson03 esquivel99 inegi inegi hanson hanson esquivel Above diagonal: δ = IR c IR r Diagonal: IR r Below diagonal: p(δ H 0 : IR c = IR r )
39 Findings and Directions Outline 1 Introduction Motivation Key Questions 2 Regional Inequality Revisited Design Global Inequality Dynamics 3 Summary Findings and Directions
40 Findings and Directions Inequality Results Global Significant differences found early on Mirrors pattern in the US Not much evidence of a NAFTA effect Interregional Results Choice of regionalization scheme matters Future Stability of interregional component Properties of the random labeling approach
Interregional Inequality Dynamics in Mexico Sergio J. Rey; Myrna L. Sastré-Gutiérrez
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