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Interregional Per Capita Income Differentials and Convergence: 1880–1950

Published online by Cambridge University Press:  11 May 2010

Charles A. Roberts
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Abstract

In several recently published works Richard A. Easterlin has shown that per capita incomes as measured in current dollars have tended to converge over time. In this paper the per capita income estimates have been adjusted for interregional differences in prices. In adjusting the regional per capita income estimates for interregional differences in both urban and rural-urban prices it was found that no significant differences occurred in either the levels of differences or in the rates of convergence from the original estimates. In addition, no significant correlation was found between interregional per capita incomes and price levels.

Type
Papers Presented at the Thirty-Eighth Annual Meeting of the Economic History Association
Information
The Journal of Economic History , Volume 39 , Issue 1 , March 1979 , pp. 101 - 112
Copyright
Copyright © The Economic History Association 1979

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References

1 Easterlin, Richard A., “Interregional Differences in Per Capita Income, Population, and Total Income, 1840-1950,” in Conference on Research in Income and Wealtji, Trends in the American Economy in the Nineteenth Century, Vol. 24 (Princeton, 1960), pp. 73–140Google Scholar. Easterlin, Richard A., “State Income Estimates,” Methodological Considerations and Reference Tables, Vol. I of Population Redistribution and Economic Growth, United States, 1870-1950, Kuznets, Simon and Thomas, Dorothy S., eds. (Philadelphia, 1957), pp. 703–59Google Scholar.

2 , Easterlin, “Interregional Differences,” p. 94Google Scholar

3 Ibid., p. 73.

4 , Easterlin, “State Income Estimates,” p. 747Google Scholar.

5 Ibid., p. 748.

6 Ibid., p. 747.

7 Ibid., p. 748.

8 Ibid., Table Y-l, p. 753.

9 The Mountain and Pacific regions are eliminated. The remaining regions are the same as Easter-lin's, except Oklahoma and the Dakotas are excluded due to lack of price data for 1880.

10 , Easterlin, “State Income Estimates,” Table Y-l, p. 753Google Scholar. In 1950 the “A” estimate is consistent with previous years but the “B” estimate includes “‘other income,’ consisting chiefly of government and business transfer payments,” Easterlin, ibid., p. 703 and pp. 741-42.

11 , Easterlin, “Interregional Differences,” p. 93. Region can be substituted for stateGoogle Scholar.

12 For a rather complete summary of factors affecting regional per capita incomes, see Easterlin, ibid., pp. 80-92.

13 Koffsky, Nathan, “Farm and Urban Purchasing Power,” in Conference on Income and Wealth, Studies in Income and Wealth, Vol. 11 (New York, 1949), pp. 152–78Google Scholar.

14 Coelho, Philip R. P. and Shepherd, James F., “Differences in Regional Prices: The United States, 1851-1880,” this Journal, 34 (09, 1974), 551–91Google Scholar.

15 United States Department of Labor, Bureau of Labor Statistics, Bulletin No. 1016, Handbook of Labor Statistics: 1950, (Washington, D.C., 1951), Table D-6, p. 122Google Scholar.

16 , Easterlin, “Interregional Differences,” p. 96Google Scholar

17 For basic sources see Appendix.

18 U.S. Department of Labor, Bureau of Labor Statistics, Handbook, Bulletin No. 1016, (Washington, 1951), Table D-6, p. 122Google ScholarPubMed.

19 Coefficients of rank correlation were: 1880, 0.09; 1900, 0.29; 1920, -0.67; 1950, 0.07. For Coelho and Shepherd the 1880 coefficient was -0.37 for the six regions shown ( , Coelho and , Shepherd, “Differences in Regional Prices,” Table 4, p. 571)Google Scholar.

20 Koffsky, p. 169; D. Gale Johnson estimates a similar differential of 25 percent. See , Johnson, “Functioning of the Labor Market,” Journal of Farm Economics, 33 (02, 1951), 76Google Scholar.

21 , Easterlin, “State Income Estimates,” Table L-4, pp. 609–21Google Scholar.

22 The coefficients were: 1880, 0.54; 1900, 0.75; 1920, 0.55; 1950, 0.70.

23 Hurwitz, Abner and Stallings, Carlyle P., “Interregional Differentials in Per Capita Real Income Change,” in Conference on Income and Wealth, Studies in Income and Wealth, Vol. 11 (New York, 1949), p. 217Google Scholar.

24 The rank order coefficients were: 1880, 0.09; 1900, 0.29; 1920, 0.67; 1950, 0.07.