ABSTRACT
The national economic landscape is not, of course, a homogenous plane. Planners and policymakers have long been concerned with the uneven pattern of development among regions and the resulting differences in standards of living among the population. Since the late 1970s, divergence has been observed in regional per capita earnings. This chapter considers the issue of regional income convergence by looking at the distribution of earnings rather than at per capita earnings. Differences in the distribution of earnings between the urban and rural regions are valuable because of long-standing economic development policy concern over income inequality between those two broad regions. The chapter discusses inferential evidence of profit cycles at the subnational level between 1967 and 1987, and focuses primarily on full-time earners, whose earnings should have been able to purchase the middle standard of living for themselves and their households.
