Geoscience Reference
In-Depth Information
TABLE 7.3.
The Geography of Income
and Inequality in Spain: An Overview
Average
CV*
CV*
Regional
Regional Regional
GDP pc
Gini GDP pc
Gini
1984
7607
.31
.21
0.08
1990
9655
.30
.20
0.07
2000
11856
.27
.19
0.07
* CV stands for coefficient of variation.
Over the same period of time there is also a reduction in the level of income
inequality in Spain. In 1984, the average Gini coefficient of household dispos-
able income per equivalent adult is 0.31;in2000, it drops to 0.27. Accordingly,
the spread between regions becomes slightly narrower in 2000. Nonetheless,
there are clearly three groups of regions within Spain's economic geography
in 1984: a group of regions that are highly unequal and relatively poor (these
include most prominently Galicia, Andalucia, Extremadura, and both Castilla
la Mancha and Castilla-Leon); a group of wealthier and relatively more equal
regions (the Basque Country and Catalonia); and finally, a group of wealthier
and relatively unequal regions (Madrid and Baleares).
Over time, the composition of the groups sees some changes, ultimately
reflecting the very consequences of fiscal policy and decentralization between
1984 and 2000. Clearly, transfers toward poorer regions bring the level of
inequality in the first group down, in particular in regions like Galicia and
Extremadura. In relative terms, inequality also declines among the net con-
tributors (Catalonia and, especially, Baleares, now joining the group of rich
and relatively equal regions). In turn, Madrid remains as the prominent rich
and highly unequal region of Spain. Overall, however, there is still a contrast
between a group of poor and relatively more unequal regions (Andalucia being
the most prominent example) and a group of rich and relatively more equal
regions (the Basque Country and Catalonia being the most prominent exam-
ples). The former also happens to be the bigger beneficiaries of net flows in the
Spanish fiscal structure, while the latter (in particular Catalonia, Baleares, and
Madrid), are the main contributors to the common pool (see
Figures 7.2
and
7.3
).
According to the model of preference formation developed in
Chapter 2
,
the first group should support the status quo, as they receive large bene-
fits through both interpersonal (social security) and interregional redistribu-
tion. In contrast, I would expect the second group to reduce the share of
their tax base devoted to distributive conflicts beyond their regional borders.
Hence, I would expect the main political parties in Catalonia, Baleares, and
the Basque country to push for more fiscal autonomy and the decentraliza-
tion of public insurance systems, raising the flag of fairness and efficiency.
And I would expect the main parties in Galicia, Andalucia, Extremadura, and
