The impact of population on the reduction of steady-state disparities across Spanish regions

Despite the abundant literature on convergence across the Spanish regions, most of the empirical research has used cross-section regressions or panel data techniques with fixed effects, resulting in biased estimates. Furthermore, many of these studies have not explicitly accounted for the effect of...

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Bibliographic Details
Published in:The Annals of regional science 2013-02, Vol.50 (1), p.49-69
Main Authors: Mayoral, Fernando Martín, Garcimartín, Carlos
Format: Article
Language:English
Subjects:
Bgi / Prodig
Birth rate
Capital
Convergence
Cross sections
Data models
Divergence
Dynamical systems
Dynamics
Economic growth
Economic theory
Economics
Economics and Finance
Empirical research
Environmental Economics
Estimates
Europe
European history
Fertility
Generalized method of moments
Geography
Human geography
Hypotheses
International
Investment
Investments
Landscape/Regional and Urban Planning
Microeconomics
Migration
Noncitizens
Original Paper
Panel data
Panels
Per capita
Population
Population growth
Reduction
Regional/Spatial Science
Regions
Regression analysis
Rural areas
Skilled workers
Spain
Studies
Technology
The Iberian peninsula
Urban areas
Wages & salaries
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Summary:Despite the abundant literature on convergence across the Spanish regions, most of the empirical research has used cross-section regressions or panel data techniques with fixed effects, resulting in biased estimates. Furthermore, many of these studies have not explicitly accounted for the effect of population changes in the convergence process. This paper attempts to overcome these limitations by applying a dynamic panel data model using the generalized method of moments system estimates for the seventeen regions of Spain during the 1955–2008 period. The main conclusion that stems from our analysis is that the deep reduction in steady-state disparities across Spain’s regions can be largely attributed to the differences in their population growth rates, which were mainly due to migration flows. In contrast, investment in physical capital, although it promoted convergence, played a minor role, while technology was a strong factor for divergence.
ISSN:0570-1864
1432-0592
DOI:10.1007/s00168-011-0475-z