Abstract
In this Journal, Sukkoo Kim investigates the sources of income convergence and divergence across regions in the United States. Kim argues that there are two sources of income convergence in regional economies linked by trade: convergence in regional wage rates and convergence in regional industry mixes. Using U.S. regional data on industry mix and worker income by industry, Kim decomposes differences in regional incomes into industry wage and industry-mix components. From his decompositions, Kim concludes that changing regional industrial structures “played an important role in causing the divergence and convergence of U.S. regional income per capita” in both the nineteenth and twentieth centuries..
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