Issue 50 – Summer 2021


European Regional Policy

Francisco José Delgado Rivero

Next Generation EU: a panorama and its dimension regional in Spain

In this note, we revise the new temporal recovery instrument of the EU, Next Generation EU, with 750,000 million for 2021-2027, with attention to the Spanish case. Like the other European funds, this new instrument, which will amount to more than 140,000 million for Spain between loans and aids, has clear regional and local implications, and poses not a few challenges that will also be addressed in this paper.


Keywords: European funds, Next Generation EU, covid-19, regional

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Juan Ramón Cuadrado-Roura

Development and Consolidation of Regional Studies in Spain

Regional problems have always occupied a rather important place among the concerns of the Spanish society.  This has been closely linked to longstanding historical and internal political conflicts. But, leaving aside some contributions developed in the past, the research on territorial issues emerged really in the 1960s and the consolidation phase took place from 1975 to 2000, as explained in sections 2 and 3. From the beginning of the actual century the field has received a clear thrust, supported by a new generation of economists and geographers. The increasing presence of Spanish researchers in international congresses, workshops and specialized journals enable to state that Spain has reached a similar level as in more advanced countries. Section 4 collects the most outstanding topics and innovative contributions made and section 5 suggest some new fields of interest. A short final note points out why a continuity of the progress observed can be expected. The main objective of the paper is to offer a panoramic review of the development and consolidation or regional and urban studies in Spain.

Keywords: Regional research; spanish contributions; relevant topics; innovative contributions

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Luis F. Alvarez León

Digital trade and the remaking of the North American regional economy

North American Free Trade Agreement (NAFTA) was a cornerstone of the 1990s liberal hegemony established with the rise of multilateral trade agreements. On July 1st 2020, NAFTA was replaced by a new trade deal: USMCA (United States-Mexico-Canada Agreement). This article argues that through the inclusion of digital trade provisions, USMCA signifies a vision of a regional economic space that differs substantively from NAFTA’s. To make this case, the article examines the digital trade provisions in USMCA, contrasts them with the vision of trade advanced by NAFTA, and evaluates how they create conditions that can transform the North American space-economy.

Keywords: Digital trade; e-commerce; digital economy; international trade; regions; North America

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Antoni Zabalza

Restructuring proposal for the Spanish regional debt

Spanish regional public debt as percentage of GDP was practically constant, around 6%, between 1955 and 2007. From 2007, due to the Great Recession, regional public debt increased significantly up to a maximum of almost 25% in 2016, and gradually stabilized afterwards. In 2019, regional public debt was 23.7% of GDP. The Spanish regional finance system has not been designed to manage such high levels of debt. In fact, from 2012 onwards most regional governments would have incurred in default had it not been for the financial assistance obtained from the central government. This sequence of events is not surprising: regional governments are responsible for essential services such as health and education, and their revenues, due to the updating mechanism of the regional finance system, depend on the variation of the main national taxes and, therefore, on the economic cycle. Given that, it is not surprising that sooner or later regional governments had to incur in large amounts of debt to finance their expenditure responsibilities. This article argues: i) that the present lack of connexion between expenditure needs and the resources that the regional finance system puts at the disposal of regional governments must be redressed by reforming the updating mechanism of the system; and ii) that the huge debt burden of regional governments accumulated during the Great Recession must be eliminated by means of a properly designed restructuring plan.

Keywords: Regional debt; debt restructuring; updating mechanism; expenditure needs; soft budget constraint; moral risk

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Miguel Ángel Mendoza-González

Trade openness, production shocks and externalities with space-time cycles in economic growth by state in Mexico, 1980-2018

This research analyses the relationship of trade liberalization with the conditions in which production shocks cause externalities with space-time cycles in economic growth by federal entity of Mexico. For this purpose, the methodology of STARMA models is used in economic growth by federal entity, which is explained by the behavior of the regions of influence according to the territorial neighbors of the first y second order. With simulations of the models, it is verified that multiple productive shocks cause externalities with space-time cycles in all the states. Meanwhile, individual production shocks, such as the cases of Mexico City y the State of Mexico, show that the greatest externalities are observed in second-order territorial neighbors.

Keywords: trade liberalization, regional economic growth, spatial externalities, space-time cycles, STARMA models, Mexico

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Sergio González Catalán

Regional Competitiveness in Latin America: A Comparative Study of the Key Elements for Regional Performance

Cross-country comparison is critical to understand the success of some regions and the stagnation of others in Latin America. This study measures regional competitiveness using a set of comparable regional indicators for Chile, Colombia, and Mexico in the 2008-2017 period and through a model that separates input competitiveness from results competitiveness (Aiginger and Firgo, 2017). The measurement allows comparison of regional competitiveness across countries. Results show that high regions with higher input competitiveness yield higher progress in competitiveness results for the studied period and that competitiveness capabilities play a major role in population well-being.

Keywords: Regional competitiveness; Latin America; regional performance

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Alessandra Carioli, Joaquin Recaño, Daniel Devolder

The changing geographies of fertility in Spain (1981-2018)

The objective of this article is to investigate the variation of fertility across Spain’s geographic areas between 1981 and 2018, to highlight spatial change over three decades of major fertility transformations. During the last decades, Spanish fertility decreased considerably to below replacement levels. Although total fertility remains below replacement level in Spain, there are important differences in subnational trends that seem to concentrate around certain areas.  Starting from the assumption that there is fertility diversity across the country, which persists over time and such variation is not random but rather spatially driven, we aim to describe the divergence from national trends and analyse the dynamics of spatial patterns of fertility over time with spatial analysis tools. Using from Spanish municipality data, we use 910 territorial units that ensure spatial contiguity and construct yearly fertility indicators derived from census and register data, encompassing fertility by age, birth order, and age at childbirth. We investigate the spatial patterns of fertility and their changes over time, by means of spatial and correlogram analysis, exploring the effects of neighborhood definitions. Results confirm the presence of spatial autocorrelation for all variables throughout the considered timeframe, both at global and local scale. The considered time frame depicts substantial changes in the distribution of low and high fertility clusters, reshaping the geographical distribution of fertility in Spain, with big metropolitan areas as leaders in high fertility, as childbearing is deeply impacted by labor market covariates.

The fertility decline in Spain has driven total fertility to below replacement levels in a short period of time, shifting the classical North-South divide of low-high fertility into an East-West clustering, with economic centres such as cities becoming the new focal points of higher fertility. The descriptive and econometric spatial approaches adopted in this article, together with the detailed data available for this study, make it possible to appreciate the scale of fertility changes across the country, its heterogeneity across regions, and the evolution of fertility determinants over time.  

Keywords: Fertility; time series; Spain; spatial demography; subnational fertility

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Andrés Niembro, Carla Daniela Calá, Andrea Belmartino

A typology of Local Economic Areas in Argentina based on sectoral profiles of territorial coagglomeration (2011-2018)

The study of regional productive specialization is key to designing territorial development policies. However, the measures commonly used do not take into account the interdependence between activities and present other problems related to the level of sectoral disaggregation. To overcome these limitations, we propose a new strategy to define regional specializations using multivariate analysis techniques, applied to data on formal and private salaried employment in Argentina. First, we form a set of sectoral profiles of territorial coagglomeration and, from them, we define an empirical typology of Local Economic Areas according to their production patterns. Our results show that the proposed methodology captures the interdependencies between activities, distinguishes different specializations within aggregated sectors, and accounts for both the type of specialization and the degree of productive diversity in the regions.

Keywords: Co-location; Specialization; Diversification; Principal component analysis; Cluster analysis

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