Explaining within-country Regional Inequality in the European Union

Toni Mora

SCIENZE REGIONALI, 2008, vol. 2008/Suppl. 2, issue Suppl. 2, 51-69

Abstract: Explaining within-country Regional Inequality in the European Union A Kuznetsian regional convergence process is estimated for within-country inequality in the European Union for the period 1986-1998. As a novelty, the estimation takes account of the correct functional form, because inequality measures have several properties (Anand and Kanbur, 1993a). The main finding is that development levels and within-country regional disparities show a positive relationship. National fiscal policies reduce intra-national GDPpc disparities, whereas differences in human capital evolution and improving trade competitiveness push up regional within-country inequality. Partial effects are found for the dispersion in sectorial specialization, but none for European regional aid policy. The robustness of the results is demonstrated both by correcting panel data standard errors and by using alternative inequality measures. Keywords: development level, European integration, Kuznets convergence and regional analysis JEL classification codes: O4, O52, O15

Date: 2008
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