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Working paper 656

Gordon John Anderson, "Convergence or Polarization? 21st Century Interprovincial and Gender Based Distributional Variation in the Incomes, Ages and Education of Canadians.", 2020-02-20
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Abstract: Growing economic inequalities between a confederations’ constituencies can be a catalyst for the deterioration of its cohesiveness. The underlying idea is that inequalities that are more equally shared amongst a collection of subgroups, the more easily are they borne by the collection as a society. In focussing on empirical and theoretical bases for average income processes trending towards multiple or singular poles of attraction, the growth and convergence literature has long concerned itself with such issues. However, focussing on averages can be problematic since it can mask important distributional differences that can only be revealed when distributions are compared in their entirety. Here tools for examining distributional differences, exceptionalities and similarities which surmount these problems are employed in an interprovincial / gender based study of the progress of Canadian personal incomes and proxies for its latent experience and embodied human capital drivers namely age and experience. While the joint distributions of the drivers appear to be diverging, income distributions appear to be converging. However, closer inspection reveals that, when viewed separately, female and male income distributions are each diverging across the provinces, but the divergence is masked by the overall convergence of male and female distributions.

Keywords: Distributional Differences, Inequality Indices,Multilateral Comparisons

JEL Classification: O47;I31