Roles of Geographical Heterogeneity on Income Distribution: Empirical Evidence from Thailand
Thailand faces persistent regional income disparities shaped by geographical heterogeneity, according to an empirical study analyzing data from national household surveys and satellite imagery. Using Mincer’s earnings function and the Generalized Method of Moments (GMM), the research found that income levels vary significantly across provinces, with the central region—driven by manufacturing and services—outperforming the agriculture-dependent northern and northeastern regions. Night-time light intensity, used as a proxy for economic activity, confirmed these spatial disparities, showing strong income clustering in Bangkok and surrounding provinces. The study concludes that geographical characteristics, such as industrial concentration and resource endowments, play a crucial role in income distribution, emphasizing the need for region-specific development policies to address inequality and promote balanced economic growth across Thailand.