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An Assessment of the Causal Relationship between Growth and Inequality in Spanish Regions

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  • Salvador Pérez-Moreno

Abstract

This paper analyses the causal relationship between economic growth and income inequality in Spanish regions from 1970 to 2000. We examine such a relationship using a panel of data with four time observations on the level variables for each region. Thus, we use a modified form of traditional Granger causality tests to suit the short times series that are available. Applying a sum--difference test, we conclude that the empirical evidence supports the hypothesis that gross domestic product (GDP) per capita growth in Spanish regions leads to less income inequality, rather than any other possible causal relationship.

Suggested Citation

  • Salvador Pérez-Moreno, 2007. "An Assessment of the Causal Relationship between Growth and Inequality in Spanish Regions," European Planning Studies, Taylor & Francis Journals, vol. 17(3), pages 389-400, December.
    • Handle: RePEc:taf:eurpls:v:17:y:2007:i:3:p:389-400
    DOI: 10.1080/09654310802625296
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    Cited by:

    1. Salvador Perez-Moreno, 2011. "Financial development and poverty in developing countries: a causal analysis," Empirical Economics, Springer, vol. 41(1), pages 57-80, August.

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