Regional Income Inequality in Mongolia 1989-1999

Regional Income Inequality in Mongolia; 1989-1999

Takahiro Akita£ª£¦ Enkhbayar Shagdar£ª£ª

Abstract

This paper analyzes the extent and dynamics of regional income inequality in Mongolia during the decade of economic reform that has taken place since the beginning of the 1990s, with the country shifting from a planned economy to a market economy. Regional per capita output was estimated and used as a measure of welfare in a region and regional inequality was evaluated using both Theil indices (Theil T and Theil L) and the weighted coefficient of variation. In order to examine the factors that determine regional inequality, overall regional inequality, measured by the weighted coefficient of variation, was decomposed according to different sources of income.
Interregional inequality, which was pronounced in Mongolia even before economic reform, increased with a remarkable change in its determinants and structure during the 1990s. As this study reveals, the industry ...