Income Distribution and Economic Development: Some Intra-Country Evidence.

Current theories of economic development suggest a virtual plethora of hypotheses about particular economic and socioeconomic factors that affect the size distribution of income. However, existing empirical studies rely almost exclusively on cross-country data. Such studies necessarily imply a highly aggregated approach which may be singularly ill-suited to analyzing the determinants of changing income distribution during the process of development. Development does not impact evenly upon all regions of a country; rather, the historical rule seems to be the emergence of "poles of growth" within a country, where polarization effects outweigh spread effects.[1] Models of dual development, of course, are a standard device in development economics [4], yet their value is implicitly disregarded by empirical studies that fail to disaggregate data below the country level.
The purpose of this paper is to provide a more useful analysis of the influences of several structural elements on income inequalities in a less-developed country, Costa Rica. The level of regional aggregation in this study is very low, the distrito, a county-like political subdivision, of which 335 existed in Costa Rica in 1963. [ABSTRACT FROM AUTHOR]