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Income inequality within European regions: determinants and effects on growth

  • Gaetano Martino
  • Cristiano Perugini

Economic inequality across Europe has been largely investigated by analysing the determinants and dynamics of the disparities between countries and regions. Similarly, many studies have focused on inequality within European countries. So far, less attention has been devoted to economic inequality within European regions, mainly due to data shortages. The aim of this paper is to shed some light on this level of analysis. After the introductory section, the first part of the paper poses the conceptual bases of the study, examining relevant theoretical and empirical arguments about (i) the determinants of economic inequality, (ii) the relationship between economic inequality and growth, and (iii) the desirability and specificity of regional analysis. The second part of the paper, by means of various econometric approaches, provides evidence of the centrality, for regional inequality levels, of labour market qualitative and quantitative aspects and of some country-level institutional settings. As regards the effects of inequality on growth, outcomes suggest that a positive relationship may exist.

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Paper provided by Università di Perugia, Dipartimento Economia in its series Quaderni del Dipartimento di Economia, Finanza e Statistica with number 52/2008.

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Length: 32 pages
Date of creation: 08 Apr 2008
Date of revision:
Handle: RePEc:pia:wpaper:52/2008
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