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Estimating the Personal Income Distribution in Spanish Municipalities Using Tax Micro-Data

Author

Listed:
  • Miriam Hortas-Rico

    (Universidad Complutense de Madrid, Spain.)

  • Jorge Onrubia

    (Universidad Complutense de Madrid, Spain.)

  • Daniele Pacifico

    (Department of the Treasury – Italian Ministry of Economy and Finance; Centre for North-South Economic Research, University of Cagliari, Italy)

Abstract

Local income data is an important economic indicator, widely used in a broad range of studies related to regional convergence, urban economics, fiscal federalism, housing and spatial analysis. Despite its importance, there is a lack of official data on local incomes and, most importantly, on local income distributions. In this paper we use official data on personal income tax returns and a reweighting procedure to derive a representative income sample at the local level. Unlike previous attempts in the literature to acquire local income estimates, the results obtained allow us to derive not only an average value for income but also its local distribution, a valuable and informative tool for analysing distributional and income inequality. We apply this methodology to Spanish Personal Income Tax micro-data and illustrate its potential use in analysing income inequality by means of computed Gini, Atkinson indexes and top 0.01%, 0.5% and 0.01% income share measures for the most populated Spanish municipalities (those with over 160,000 inhabitants).

Suggested Citation

  • Miriam Hortas-Rico & Jorge Onrubia & Daniele Pacifico, 2014. "Estimating the Personal Income Distribution in Spanish Municipalities Using Tax Micro-Data," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1419, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
  • Handle: RePEc:ays:ispwps:paper1419
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    References listed on IDEAS

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    Cited by:

    1. Francesc Amat & Pablo Beramendi & Miriam Hortas-Rico & Vicente Rios, 2020. "How inequality shapes political participation: The role of spatial patterns of political competition," Working Papers. Collection B: Regional and sectoral economics 2002, Universidade de Vigo, GEN - Governance and Economics research Network.

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