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On the determinants of convergence and divergence processes in Spain

Author

Listed:
  • Leone Leonida

    (Università Degli Studi Della Calabria)

  • Daniel Montolio

    (Universitat de Barcelona)

Abstract

This paper studies the dynamics of convergence and divergence in Spain over the period 1965-1995. We analyse the evolution of the per capita income distribution across Spanish provinces and estimate the effects on this evolution of factors such as private, human and public capital, and an industrialisation index. We show that after a period of absolute convergence over the 1960s and early 1970s, the provinces polarised (club convergence) during the 1980s. This polarisation process preceded a period of divergence among clubs, which began to appear during the 1990s. By estimating counterfactual densities, we show that private capital accumulation and education at graduate level can account for a relevant fraction of the actual dispersion and polarisation of incomes. We also find that public capital has reduced inequalities, especially in recent years, through redistribution of incomes rather than by increasing productivity. (Copyright: Fundación SEPI)

Suggested Citation

  • Leone Leonida & Daniel Montolio, 2004. "On the determinants of convergence and divergence processes in Spain," Investigaciones Economicas, Fundación SEPI, vol. 28(1), pages 89-121, January.
    • Handle: RePEc:iec:inveco:v:28:y:2004:i:1:p:89-121
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    References listed on IDEAS

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    Cited by:

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    2. Valerija Botric & Tanja Broz, 2016. "Exploring CESEE-EMU Synchronisation Patterns," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 18(42), pages 255-255, May.
    3. Theodoros Arvanitopoulos & Vassilis Monastiriotis & Theodore Panagiotidis, 2021. "Drivers of convergence: The role of first- and second-nature geography," Urban Studies, Urban Studies Journal Limited, vol. 58(14), pages 2880-2900, November.
    4. Leone Leonida, "undated". "On the Effects of Industrialization Processes on Growth and Convergence Dynamics: Evidence from Italian Regions," Discussion Papers 04/15, Department of Economics, University of York.
    5. Miss Catriona Purfield, 2006. "Mind the Gap—Is Economic Growth in India Leaving Some States Behind?," IMF Working Papers 2006/103, International Monetary Fund.
    6. Giorgio Canarella & Stephen Pollard, 2006. "Distribution dynamics and convergence in Latin America: A non-parametric analysis," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 53(1), pages 68-95, March.

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    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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