Objective 1 regions versus non-objective 1 regions. What does the Theil Index tell us?

Abstract

The evolution of regional income disparities between two blocks of regions, objective 1 regions and non-objective 1 regions is analysed for the period 1982 to 1997, by using a Generalized entropy index such as the Theil index. The results show that between 1982 and 1987 the income disparities between objective 1 regions and non-objective 1 regions have increased, while from 1987 onwards objective 1 regions catch up with the non-objective 1 regions.

Notes

¹ The vast theoretical and empirical literature on inequalities has produced a substantial number of measures. See Cowell (1995) for an excellent survey of measures and their potential drawbacks.

² In all the computations ‘objective 1 group’ takes in those NUTS II regions that were objective 1 either in the first programming period (1989–1994) (Delor's I Package) or in the second programming period (1995–1999) (Delor's II Package) and ‘non-objective 1 group’ takes in the remainder of the European Union NUTS II regions.

³ The Appendix lists the NUTS II regions that belongs to each group considered.