Analysis of Regional Disparities and Wage Convergence in Alabama

This paper examines the degree to which real wages have converged in Alabama over the last thirty-seven years. The increase in government transfers, improvement in information technology and possibly, other government assistance programs would suggest that, wages in spatially dispersed counties with...

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Bibliographic Details
Published inAfrican journal of agricultural research Vol. 6; no. 2; pp. 363 - 375
Main Authors Bukenya, James O, Davis, Cedric, Banerjee, Swagata, Gyawali, Buddhi
Format Journal Article
LanguageEnglish
Published Lagos Academic Journals 18.01.2011
Subjects
Comparative studies
Economic history
Economics-Business
Rural areas
Sociology and Anthropology
States
Statistical analysis
United States
Urban areas
Wage differential
Alabama
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Summary:This paper examines the degree to which real wages have converged in Alabama over the last thirty-seven years. The increase in government transfers, improvement in information technology and possibly, other government assistance programs would suggest that, wages in spatially dispersed counties within nation-state should become similar over time. However, the interrelation between business cycles, migration, employment structure and changes in per capita earnings over time reduces this possibility. To test the convergence hypothesis, comparable county-level real wage data are obtained from the U.S. Bureau of Economic Analysis and analyzed using cross-section and time series techniques. Particularly, two hypotheses are tested: (1) whether real wages in poor economies (rural counties) are catching up with real wages in rich economies (urban counties), and (2) whether adjacency to urban areas has an effect on the transition from low wages to high wages for rural workers in Alabama. Key findings are reported.
ISSN:1991-637X