Measuring income inequality at the regional level in Poland

Reducing regional inequality was one of the key means of promoting the “harmonious development” within Europe envisioned in the EEC Treaty of 1957. The pursuit of “economic, social and territorial cohesion” through ever closer regional and national harmonisation was also proclaimed in the 2007 Lisbon Treaty, but deepening European integration has not always been matched with convergence in living standards between sub-national regions. The gap between poorer and richer areas increased during the last economic crisis even in some developed economies, and the income discrepancy between richer and poorer regions is likely to widen further as government-spending cuts disproportionately hurt less prosperous parts.  

Regional inequalities can be measured in many ways- we may map the extent of inequality in demography, income and wealth, labour markets, and education and skills. The main objective of the presentation is to analyse regional inequalities in terms of household income distribution. In order to meet the increasing demand for statistical data at relatively low aggregation level, different population divisions have been taken into consideration.   The empirical evidence coming from Household Budgets Survey conducted by Central Statistical Office of Poland  as well as auxiliary data coming from administrative registers, has been analysed by means of inequality and poverty indices calculated at the Nomenclature of Territorial Units for Statistics (NUTS) 1 and NUTS 2 levels.  Due to insufficient sample sizes for NUTS2 regions, small area estimation methods have been applied.  For these regions, besides direct estimation methods, the model based approach was taken into regard. Standard errors of estimates were also considered in the paper.