Regional welfare weights for the UK: England, Scotland, Wales and Northern Ireland

• Published in: Regional studies 2005-10, Vol.39 (7), p.923-937
• Main Authors: Evans, D., Kula, E., Sezer, H.
• Format: Article
• Language: English
• Subjects: Bgi / Prodig; Comparative studies; D61; Empirical tests; Europe; Grenznutzung; Human geography; Income distribution; Income elasticity; Income taxes; Indices de bienestar social; JEL classifications: D60; JEL classifications: D60, D61, R10; Marginal de los ingresos; Marginal utility; National income; Ponderations relatives a la protection sociale; Pondérations relatives à la protection sociale; Public expenditure; Public finance; Public policy; R10; Regional studies; Reino Unido; Royaume-Uni; Social impact; The British Isles; United Kingdom; Utlilite marginale; Utlilité marginale; Welfare; Welfare weights; Wohlfahrtslasten; Índices de bienestar social
• ISSN: 0034-3404; 1360-0591
• DOI: 10.1080/00343400500289937

Evans D., Kula E. and Sezer H. (2005) Regional welfare weights for the UK: England, Scotland, Wales and Northern Ireland, Regional Studies 39 , 923-937. In relation to public spending and regional policy, the importance of distributional issues is stressed, and regional welfare weights are derived from an appropriate underlying social welfare function. Estimates of these weights are then provided for the four countries comprising the UK. Welfare weights now have a very high policy profile following the special emphasis placed by the UK Treasury, in its recently revised guidance on appraisal and evaluation in government, on the assessment of the distributional impacts of social projects and policies. From an empirical perspective, the critical component of each welfare weight measure is the elasticity of marginal utility of income ( e ). Alternative estimation approaches based on demand analysis and income tax data are used to determine e , and a preferred measure of 1.60 emerges. The resulting regional welfare weights are then compared with recent patterns of per-capita regional public expenditure in the UK. The paper concludes by emphasizing the scope for further empirical work on welfare weights and regional policy in relation to both the UK and the European Union.