An alternative inequality-based concentration measure

Abstract

The aim of this paper is twofold. First, it shows the properties that regional economics is implicitly assuming when �relative� inequality measures, such as the Gini coefficient and the generalized entropy family of indexes, are used to quantify the geographic concentration of economic activity. Second, it proposes a new geographic concentration index that is based on an �absolute� inequality measure. This measure, which is additively decomposable, is also analyzed from an axiomatic point of view. Comparisons between these concentration indexes are illustrated by using manufacturing employment data in Spain.