Income Inequality: A State-by-State Complex Network Analysis

Physica A: Statistical Mechanics and its Applications, September 2017

27 Pages Posted: 28 Jun 2015 Last revised: 26 Nov 2017

See all articles by Periklis Gogas

Periklis Gogas

Democritus University of Thrace - Department of Economics

Rangan Gupta

University of Pretoria - Department of Economics

Stephen M. Miller

University of Nevada, Las Vegas - Department of Economics; University of Connecticut - Department of Economics

Theophilos Papadimitriou

Department of Economics, Democritus University of Thrace

Georgios Sarantitis

Democritus University of Thrace - Department of Economics

Date Written: June 26, 2015

Abstract

This study performs a long-run, inter-temporal analysis of income inequality in the U.S. for the period 1916-2012. We use a) descriptive analysis to examine the evolution of inequality through time and b) complex network tools, more specifically an optimization technique called the Threshold-Minimum Dominating Set, which provides new insight on the pattern income inequality across the U.S. states. Several empirical findings emerge. First, inequality displays a heterogeneous evolution across the four focal sub-periods. Second, the results differ between the inequality measures examined, namely the Top 1% share of income and the Gini coefficient. Finally, groups of similarly behaving states (in terms of inequality) are identified that the U.S. authorities can use to investigate the causes of inequality within the U.S. and implement the appropriate policy interventions.

Keywords: Income inequality, graph theory, US states

JEL Classification: D63

Suggested Citation

Gogas, Periklis and Gupta, Rangan and Miller, Stephen M. and Papadimitriou, Theophilos and Sarantitis, Georgios, Income Inequality: A State-by-State Complex Network Analysis (June 26, 2015). Physica A: Statistical Mechanics and its Applications, September 2017. Available at SSRN: https://ssrn.com/abstract=2623750 or http://dx.doi.org/10.2139/ssrn.2623750

Periklis Gogas

Democritus University of Thrace - Department of Economics ( email )

Komotini, 69100
Greece

HOME PAGE: http://www.econ.duth.gr/personel/dep/gkogkas/index.en.shtml

Rangan Gupta

University of Pretoria - Department of Economics ( email )

Lynnwood Road
Hillcrest
Pretoria, 0002
South Africa

Stephen M. Miller (Contact Author)

University of Nevada, Las Vegas - Department of Economics ( email )

4505 S. Maryland Parkway
Box 456005
Las Vegas, NV 89154
United States
702-895-3776 (Phone)
702-895-1354 (Fax)

HOME PAGE: http://faculty.unlv.edu/smiller/

University of Connecticut - Department of Economics

365 Fairfield Way, U-1063
Storrs, CT 06269-1063
United States

Theophilos Papadimitriou

Department of Economics, Democritus University of Thrace ( email )

University Campus
Komotini, 69100
Greece

HOME PAGE: http://econ.duth.gr/author/papadimi/

Georgios Sarantitis

Democritus University of Thrace - Department of Economics ( email )

Komotini
Greece

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