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The Income Inter-Regional Redistribution And The Income Spatial Stabilization Effects: An Application To Portugal

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  • Pedro N. Ramos

    () (Faculdade de Economia da Universidade de Coimbra (Portugal))

  • Carla Coimbra

    () (Instituto Nacional de Estatistica (Portugal))

Abstract

The main idea of this paper is that although the per capita regional GDP is a good indicator of regional income according to its place of generation, it cannot take into account the redistribution process that comes after production, and that may be very significant at the regional level. The paper focuses then on the transformation of the regional product on the adjusted disposable income of the households, and on the different redistributive flows that proceed with that transformation. It has two distinct parts. Firstly we adopted a synchronic analysis where we deal with the so-called income inter-regional redistribution process. In this part we wonder how the regional income inequalities, that are the outcome of the different locations of production, are smoothed when the income falls into the hands of the households (or if the contrary happens, how they are amplified). The identification and the estimation of the weights of the different channels through which that lessening (or amplifying) process acts is an essential part of the work. In a second part ahead we turn to a dynamic approach where we focus on the spatial stabilization of the income effect. At this point our purpose is rather to look at the shocks on the regional product, and to discuss how they can be absorbed (or not) when the production income is transmuted into the regional adjusted disposable income of the households. The degree and the channels of risk sharing (as this absorption process is named too) are also estimated.

Suggested Citation

  • Pedro N. Ramos & Carla Coimbra, 2009. "The Income Inter-Regional Redistribution And The Income Spatial Stabilization Effects: An Application To Portugal," Regional Science Inquiry, Hellenic Association of Regional Scientists, vol. 1(1), pages 35-44, August.
  • Handle: RePEc:hrs:journl:v:1:y:2009:i:1:p:35-44
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    File URL: http://www.rsijournal.eu/ARTICLES/Journal_1/RSIjournal2009.pdf
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    References listed on IDEAS

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    1. Miller, Carol D., 2006. "Fear and Loathing in a Paper Mill Town: Local Perceptions of Globalization," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 36(2).
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    Cited by:

    1. Masayoshi Hayashi, 2012. "Channels of Stabilization in a System of Local Public Health Insurance: The Case of the National Health Insurance in Japan," CARF F-Series CARF-F-280, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
    2. Masayoshi Hayashi, 2013. "On the Decomposition of Regional Stabilization and Redistribution," CIRJE F-Series CIRJE-F-910, CIRJE, Faculty of Economics, University of Tokyo.

    More about this item

    Keywords

    Inter-regional redistribution; spatial stabilization; risk sharing; cross-sectional variance;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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