IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/72921.html
   My bibliography  Save this paper

Regional development in Spain 1989-2010: capital widening and productivity stagnation

Author

Listed:
  • Montes-Solla, Paulino
  • Faiña Medín, J. Andres
  • Lopez-Rodriguez, Jesus

Abstract

This paper analyses the different factors that explain the pattern of economic growth in Spain along the 1989-2010 period. The results of our analysis provide strong evidence of stagnation in productivity throughout most of the period under study. The large investments and the strong growth in capital stocks were practically absorbed by an intense process of job creation. As a consequence, the capital/labour ratio and labour productivity levels had a very low growth, whereas total factor productivity (TFP) decreased over the period of analysis. Therefore unlike other European countries, Spain did not experience a phenomenon of capital deepening with an increase in productivity. The intense GDP pc growth in Spain was of a rather "extensive" type, mainly based on a capital widening process.

Suggested Citation

  • Montes-Solla, Paulino & Faiña Medín, J. Andres & Lopez-Rodriguez, Jesus, 2015. "Regional development in Spain 1989-2010: capital widening and productivity stagnation," MPRA Paper 72921, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:72921
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/72921/1/MPRA_paper_72921.pdf
    File Function: original version
    Download Restriction: no
    File URL: https://mpra.ub.uni-muenchen.de/73566/1/MPRA_paper_73566.pdf
    File Function: revised version
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Matilde Mas & Carlo Milana & Lorenzo Serrano, 2012. "Spain and Italy: Catching-up and Falling Behind – Two Different Tales of Productivity Slowdown," Chapters, in: Matilde Mas & Robert Stehrer (ed.), Industrial Productivity in Europe, chapter 6, Edward Elgar Publishing.
    2. John A. Tatom, 1991. "Public capital and private sector performance," Review, Federal Reserve Bank of St. Louis, issue May, pages 3-15.
    3. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    4. Thomas Farole & Andrés Rodríguez‐Pose & Michael Storper, 2011. "Cohesion Policy in the European Union: Growth, Geography, Institutions," Journal of Common Market Studies, Wiley Blackwell, vol. 49(5), pages 1089-1111, September.
    5. Alicia H. Munnell, 1990. "How does public infrastructure affect regional economic performance?," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 34, pages 69-112.
    6. -, 1995. "Productividad de los pobres rurales y urbanos," Cuadernos de la CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 27776 edited by Cepal, September.
    7. Dale W. Jorgenson & Kevin J. Stiroh, 2000. "Raising the Speed Limit: U.S. Economic Growth in the Information Age," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 31(1), pages 125-236.
    8. Juan Ramón Cuadrado Roura & Andrés Maroto Sánchez, 2011. "Análisis del proceso de especialización regional en los servicios en España," Working Papers 03/11, Instituto Universitario de Análisis Económico y Social.
    9. Jesus Lopez-Rodriguez & J. Andres Faina & Jose Lopez-Rodriguez, 2007. "Human Capital Accumulation and Geography: Empirical Evidence from the European Union," Regional Studies, Taylor & Francis Journals, vol. 41(2), pages 217-234.
    10. Redding, Stephen & Schott, Peter K., 2003. "Distance, skill deepening and development: will peripheral countries ever get rich?," Journal of Development Economics, Elsevier, vol. 72(2), pages 515-541, December.
    11. Bentolila Samuel & Saint-Paul Gilles, 2003. "Explaining Movements in the Labor Share," The B.E. Journal of Macroeconomics, De Gruyter, vol. 3(1), pages 1-33, October.
    12. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March.
    13. Mas, Matilde & Quesada, Javier, 2006. "The Role of ICT on the Spanish Productivity Slowdown," MPRA Paper 15828, University Library of Munich, Germany, revised 2006.
    14. Robert E. Hall & Charles I. Jones, 1999. "Why do Some Countries Produce So Much More Output Per Worker than Others?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(1), pages 83-116.
    15. Philippe Aghion & Peter Howitt, 2007. "Capital, innovation, and growth accounting," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 23(1), pages 79-93, Spring.
    16. Luis Serven & César Calderon, 2004. "The Effects of Infrastructure Development on Growth and income," Econometric Society 2004 Latin American Meetings 173, Econometric Society.
    17. Lars-Hendrik Roller & Leonard Waverman, 2001. "Telecommunications Infrastructure and Economic Development: A Simultaneous Approach," American Economic Review, American Economic Association, vol. 91(4), pages 909-923, September.
    18. -, 1995. "Población, equidad y transformación productiva," Libros de la CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 2146 edited by Cepal.
    19. Dale W. Jorgenson, 1995. "Productivity, Volume 1: Postwar US Economic Growth," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262100495, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Silvia Bertarelli, 2006. "Public capital and growth," Politica economica, Società editrice il Mulino, issue 3, pages 361-398.
    2. Stephane Straub, 2011. "Infrastructure and Development: A Critical Appraisal of the Macro-level Literature," Journal of Development Studies, Taylor & Francis Journals, vol. 47(5), pages 683-708.
    3. Martin Werding & Sonja Munz & Vera Gács, 2008. "Fertility and prosperity : links between demography and economic growth," ifo Forschungsberichte, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 42, October.
    4. Lopez-Rodriguez, Jesus & Martinez-Lopez, Diego, 2017. "Looking beyond the R&D effects on innovation: The contribution of non-R&D activities to total factor productivity growth in the EU," Structural Change and Economic Dynamics, Elsevier, vol. 40(C), pages 37-45.
    5. Heinz Handler & Margit Schratzenstaller, 2006. "Teilstudie 7: Die Rolle des Staates," WIFO Studies, WIFO, number 27446, February.
    6. Ibrahim B. Kamara, 2007. "The Direct Productivity Impact of Infrastructure Investment: Dynamic Panel Data Evidence From Sub Saharan Africa," Working Papers 048, Economic Research Southern Africa.
    7. Sahoo, Pravakar & Dash, Ranjan Kumar & Nataraj, Geethanjali, 2010. "Infrastructure development and economic growth in China," IDE Discussion Papers 261, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    8. Jung, Juan & López-Bazo, Enrique, 2020. "On the regional impact of broadband on productivity: The case of Brazil," Telecommunications Policy, Elsevier, vol. 44(1).
    9. Crihfield, John B. & Panggabean, Martin P. H., 1995. "Is public infrastructure productive? A metropolitan perspective using new capital stock estimates," Regional Science and Urban Economics, Elsevier, vol. 25(5), pages 607-630, October.
    10. Kluge, Jan & Lappoehn, Sarah & Plank, Kerstin, 2020. "The Determinants of Economic Competitiveness," IHS Working Paper Series 24, Institute for Advanced Studies.
    11. Straub, Stephane, 2008. "Infrastructure and growth in developing countries : recent advances and research challenges," Policy Research Working Paper Series 4460, The World Bank.
    12. Holmgren, Johan & Merkel, Axel, 2017. "Much ado about nothing? – A meta-analysis of the relationship between infrastructure and economic growth," Research in Transportation Economics, Elsevier, vol. 63(C), pages 13-26.
    13. Timilsina,Govinda R. & Hochman,Gal & Song,Ze, 2020. "Infrastructure, Economic Growth, and Poverty : A Review," Policy Research Working Paper Series 9258, The World Bank.
    14. Crihfield, John B. & Giertz, J. Fred & Mehta, Shekhar, 1995. "Economic growth in the American states: The end of convergence?," The Quarterly Review of Economics and Finance, Elsevier, vol. 35(35), pages 551-577.
    15. repec:cuf:journl:y:2014:v:15:i:2:calderon:serven is not listed on IDEAS
    16. Ronald Kumar, 2014. "Exploring the role of technology, tourism and financial development: an empirical study of Vietnam," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(5), pages 2881-2898, September.
    17. Junjie Hong & Zhaofang Chu & Qiang Wang, 2011. "Transport infrastructure and regional economic growth: evidence from China," Transportation, Springer, vol. 38(5), pages 737-752, September.
    18. Carmela Martin & Francisco J. Velazquez & Bernard Funck, 2001. "European Integration and Income Convergence : Lessons for Central and Eastern European Countries," World Bank Publications - Books, The World Bank Group, number 13968, December.
    19. Everaert, Gerdie & Heylen, Freddy, 2001. "Public capital and productivity growth: evidence for Belgium, 1953-1996," Economic Modelling, Elsevier, vol. 18(1), pages 97-116, January.
    20. John S. Hill & Myung-Su Chae & Jinseo Park, 2012. "The Effects of Geography and Infrastructure on Economic Development and International Business Involvement," Journal of Infrastructure Development, India Development Foundation, vol. 4(2), pages 91-113, December.
    21. McPhail, Joseph E. & Orazem, Peter & Singh, Rajesh, 2010. "The Poverty of States: Do State Tax Policies Affect State Labor Productivity?," Staff General Research Papers Archive 31552, Iowa State University, Department of Economics.

    More about this item

    Keywords

    Regional development; Infrastructures; Capital widening; Productivity stagnation; Total Factor Productivity;
    All these keywords.

    JEL classification:

    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:72921. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.