Income Distribution Dynamics and Cross-RegionudConvergence in Europe. Spatial filtering and novel stochastic kernel representations

摘要

This paper suggests an empirical framework for analysing income distributionuddynamics and cross-region convergence in the European Union of 27 member states, 1995-ud2003. The framework lies in the research tradition that allows the state income space to beudcontinuous, puts emphasis on both shape and intra-distribution dynamics and uses stochasticudkernels for studying transition dynamics and implied long-run behaviour. In this paperudstochastic kernels are described by conditional density functions, estimated by a productudkernel estimator of conditional density and represented by means of novel visualisation tools.udThe technique of spatial filtering is used to account for spatial effects, in order to avoidudmisguided inferences and interpretations caused by the presence of spatial autocorrelation inudthe income distributions. The results reveal a slow catching-up of the poorest regions and audprocess of polarisation, with a small group of very rich regions shifting away from the rest ofudthe cross-section. This is well evidenced by both, the unfiltered and the filtered ergodicuddensity view. Differences exist in detail, and these emphasise the importance to properly dealudwith the spatial autocorrelation problem. (authors' abstract)