Interregional Disparities Research Articles

SUSTAINABILITY ECONOMIC AND ECONOMIC GROWTH: THE MODERATING EFFECT OF DISPARITY REGION AND INCOME ON SOCIETY WELFARE

This study aims to examine and analyze the influence of regional financial independence, capital expenditure, government investment with moderate effects of disparity between regions and income disparities to economic growth, employment and community welfare. Data analysis method used was Structural Equation Modeling (SEM) with Partial Least Square (PLS) approach, to test the ten hypotheses formulated in this research, then used path analysis (Path Analysis).
 The conclusions of this study are: (1) Regional financial independence has a positive and significant impact on economic growth, while regional financial independence with moderate effects of disparity between regions has a negative but not significant effect on economic growth. (2) Regional financial independence has a positive and insignificant effect on labor absorption, while regional financial independence with moderate effects of disparity between regions has positive and insignificant effect. (3) Regional financial independence has a positive and significant impact on the welfare of the community. (4) Local government capital expenditure has negative and insignificant effect on economic growth, while regional government capital expenditure with moderate effect of disparity between regions has positive and insignificant effect on economic growth. (5) Local government capital expenditure has negative and insignificant effect on labor absorption, while regional government capital expenditure with moderate effect of disparity between regions has positive and insignificant effect on labor absorption. (6) Local government investment has negative and insignificant effect on economic growth, while local government investment with moderate effect of inter-regional disparity has positive effect not significant to economic growth. (7) Local government investment has a positive and significant effect on labor absorption, while local government investment with moderate effect of disparity between regions has negative and insignificant effect on labor absorption. (8) Economic growth has a positive and significant impact on the welfare of the community, while the economic growth with the effect of moderation income disparity has a positive but insignificant effect on people's welfare. (9) Employment absorption has a negative and significant effect on people's welfare, while employment absorption with moderation effect of income disparity has negative and insignificant effect on people's welfare. (10) Local government investment has a positive and insignificant effect on people's welfare. Increased local government investment spending does not provide much improvement in the welfare of the people.

ICT‐equipped bank boat and the financial inclusion of the riverine population of Marajó Island in the Brazilian Amazon

AbstractThe challenge in offering public services in less developed areas in Brazil has mobilized the government in search of new and creative approaches that can reduce major interregional disparities, including lack of access to the financial system, which is the prevailing situation on Marajó Island in the state of Pará in the Brazilian Amazon. To transform this reality, an information and communication technology (ICT)–equipped travelling bank branch installed on a boat—named Agência Barco—was designed for the purpose of meeting the financial needs of the riverine population that lives in a vast territory with low population density, marked transportation difficulties, and a limited supply of ICT. Thus, this research aims to assess the impact of this bank boat in the financial inclusion of a riverine population of Marajó Island in the state of Pará, which is the unit of analysis of this work. The research outcomes indicate that Agência Barco, via ICT, has partially managed to provide access to financial products and services that might be of interest to the riverine population of Marajó Island. However, the lack of basic financial education and context‐based issues related to the ICT infrastructure has been obstacles to the financial inclusion of this riverine population. Finally, the absence of involvement of local people in this endeavour has not stimulated dynamics of empowerment and participation that could lead to sustainable financial inclusion.

Electoral Systems, Regional Resentment and the Surprising Success of Anglo-American Populism

As populist movements, partly fuelled by voters in excluded regions, drive national electoral backlashes to globalisation, why have their only outright successes come in the USA and UK? Synthesising urban/regional development theory with comparative politics, this article examines a previously unconsidered contributing factor: the interaction of globalisation’s rising inter-regional disparities with majoritarian electoral systems. Majoritarianism’s distinct internal dynamics and imperfect representation mechanisms yield insufficient state responses to rising inter-regional inequality, stoking populist discontent. Global integration may thus be less stable today under majoritarian than proportional electoral rules. This has implications for urban/regional development scholarship, globalisation’s durability and electoral reform.

High-level talent flow and its influence on regional unbalanced development in China

Brain drain has long been a concern. However, little is known about the brain drain within a country. China is a developing country which is experiencing not only overseas brain drain but also a domestic cross-regional and cross-departmental flow. In this study, we investigate the flow of high-level talent (HLT) given the background of constructing world-class universities and disciplines (WCUDs) in China and its dynamic mechanisms, and then we discuss its potential implications. The results show that over the past four decades, eastern China has been a net-inflow area, and the northeastern and midwestern regions saw a net outflow. The eastern region shows more internal regional flow. Furthermore, a large amount of HLT has flowed from scientific research institutes to colleges and universities (CUs). Regional socioeconomic gaps, imperfect systems and inadequate management are the main reasons for the flow of HLT. Regional HLT flow is not as serious as expected, but irrational flow will probably aggravate the already interregional disparity in educational resources and human capital accumulation as well as regional unbalanced development. Therefore, some measures should be taken to fight irrational high-level talent flow.

Demographic and Economic Asymmetry of Urban Development in the Urals, Siberia, and the Far East in 1991–2014

The study assesses changes in the asymmetry of demographic and socioeconomic development and territorial inequality in Russia’s East for regions and cities of the Urals, Siberia, and the Far East. The employed quantitative evaluation methods (Theil index, Gini coefficient, Herfindahl–Hirschman index) reveal multidirectional trends in the growth of economic inequality between cities contrasting to socioeconomic convergence at the regional level. It is shown that state investments to reduce interregional disparities actually intensify them at lower territorial levels, provoking increased inequality. The evolved and established center–periphery gradients result in demographic dynamics polarization between cities, manifested in increased depopulation of small towns and growth of regional capitals. At the same time, the peculiarities of the urban structure and settlement pattern in Siberia and the Far East bring about the formation of extensive demographic depressions around a small number of growing agglomerations, outside which the urban network degrades, leading to numerous negative socioeconomic consequences.

Was Poland the next Spain? Parallel analysis of regional convergence patterns after accession to the European Union

Research background: Poland and Spain share many common features resulting both from similarities of historical experience, and also cultural, political, socio-demographic factors. Both countries have a similar area, population and GDP structure. They also share historical experience related to political and economic transformation after a long period of non-democratic, centralized governments. Therefore, the experience of Spanish membership in the EU is often considered as a model for Poland.
 Purpose of the article: The purpose of this research is to perform a comparative empirical analysis of income convergence processes in Poland and Spain on a regional level. We aim to verify if and how these processes are related to one an-other (show similar paths). Special attention is paid to the periods after accession of these countries to the EU. Convergence patterns in both countries are compared with several tools.
 Methods: Spatial econometric model for absolute beta convergence, sigma convergence indicators and the analysis of distribution dynamics ? transition matrices and kernel density estimation.
 Findings & Value added: The impact on EU accession on income convergence in Spain was positive both at the national and regional level. Regional convergence processes sped-up and interregional disparities decreased. The poorest subregions had relatively high probability to increase their income and catch-up with initially more developed regions. In the first decade after accession to the EU Poland has also achieved a significant improvement of income indicators at the national level. However, empirical analyses of GDP per capita distribution and its dynamics at the regional level in Poland show that the above mentioned progress does not spread out proportionally on all regions. Neither beta nor sigma convergence is observed. Instead, relatively fastest growth of initially richest regions (mostly large cities) introduces convergence of clubs leading to polarization. EU accession has accelerated divergence processes in Poland.

So why is Uttar Pradesh still poor? Poverty incidence and its correlates

PurposeThe purpose of this paper is to examine the regional profile of poverty in Uttar Pradesh, one of the most populated and impoverished states of India. It also identifies the factors underlying the inter-regional differences of poverty in the state.Design/methodology/approachRegional estimates have been evaluated by dividing the state into four economically classified regions (Western, Central, Southern, and Eastern), using the unit-level records of two latest available Consumption Expenditure Surveys of NSSO representing the period 2009-2010 and 2011-2012. Poverty has been defined by the latest available Rangarajan Expert Groups’ poverty line and aggregated in terms of headcount ratio and share of below poverty line population. Furthermore, to investigate the correlates of poverty, a survey-based logistic regression has been estimated specifically for each region and for both rural and urban areas.FindingsEstimates reveal that though overall poverty in the state has declined, inter-regional poverty trends witness rise in the level of impoverishment particularly in urban Southern Region (SR), rural Eastern Region (ER), and in both rural and urban areas of Central Region. Nevertheless, the inter-regional disparity in poverty has observed a decline; it can further be eliminated if such high poverty reduction in urban ER and rural SR is sustained along with a similar progress in their impoverished counterparts.Originality/valueThe study recommends that poverty alleviating policies in the state should focus more on reducing the household size, development of socially excluded sub-groups (Scheduled Castes and Other Backward Classes), delivery of basic facilities (education and health care), and enhancement of employment prospects for casual laborers, with special emphasis on identified impoverished regions.

Recent Mortality Trend Reversal in Russia: Are Regions Following the Same Tempo?

After several decades of negative trends and short-term fluctuations, life expectancy has been increasing in Russia since 2004. Between 2003 and 2014, the length of life rose by 6.6 years among males and by 4.6 years among females. While positive trends in life expectancy are observed in all regions of Russia, these trends are unfolding differently in different regions. First, regions entered the phase of life expectancy growth at different points in time. Second, the age- and cause-specific components of the gains in life expectancy and the number of years added vary noticeably. In this paper, we apply decomposition techniques—specifically, the stepwise replacement algorithm—to examine the age- and cause-specific components of the changes in inter-regional disparities during the current period of health improvement. The absolute inter-regional disparities in length of life, measured by the population-weighted standard deviation, decreased slightly between 2003 and 2014, from 3.3 to 3.2 years for males, and from 2.0 to 1.8 years for females. The decomposition of these small changes by ages and causes of death shows that these shifts were the result of diverse effects of mortality convergence at young and middle ages, and of mortality divergence at older ages. With respect to causes of death, the convergence is mainly attributable to external causes, while the inter-regional divergence of trends is largely determined by cardiovascular diseases. The two major cities, Moscow and Saint Petersburg, are currently pioneering mortality improvements in Russia and are making the largest contributions to the inter-regional divergence.

Determinants of agricultural household demand for insurance in China from 2004 to 2007

PurposeThe purpose of this paper is to examine the relationship between the purchase of insurance and economic growth among agricultural households.Design/methodology/approachUsing survey data of the agricultural sector obtained from China over two years, the authors highlight the effect of job switching between farm and non-farm activities on the demand for insurance by applying the difference-in-differences and triple differences methodologies.FindingsThe results show that compared with farm income, non-farm income is associated with an increased (decreased) demand for insurance among households in Eastern (Western) China. The inequality in degree of economic development between the regions plays an important role in this finding. Both education and income exhibit a positive relationship with insurance demand for most regions. In addition, in 2007, regardless of farm or non-farm sector, switches are (except in the northeast region) associated with a significant increase in insurance expenditures. Households who switched from the farm to non-farm sector in 2007 are significantly negatively associated with insurance expenditures in the western region.Social implicationsInequalities in the degree of economic development play an important role in insurance consumption.Originality/valueThe authors assess the determinants of insurance market development in the agricultural sector in China, characterized by inter-regional disparities in economic development.

PENGARUH INFRASTRUKTUR SECARA SPASIAL TERHADAP KONVERGENSI PERTUMBUHAN EKONOMI DI INDONESIA

Motivated by inter-regional disparities condition that occurs persistently, this study examines the Indonesian economy in the long run in order to know whether it tends to converge or diverge. This convergence is based on the Solow Neoclassical growth theory assuming the existence of diminishing returns to capital so that when the developed countries reach steady state conditions, developing countries will continuously grow up to 'catch-up' with developed countries. Based on regional economics perspective, each region can not be treated as a stand-alone unit,therefore, this study also focuses on the influence of spatial dependency and infrastructure. Economical and political situations of a region will influence policy in that region which will also have an impact to the neighboring regions. The estimation results of spatial cross-regressive model using fixed effect method consistently confirmed that the Indonesian economy in the long term will likely converge with a speed of 8.08 percent per year. Other findings are road infrastructure has a positive effect on economic growth and investment and road infrastructure are spatially showed a positive effect on economic growth. In other words, the investment and infrastructure of a region does not only affect the economic growth of that region but also to the economy of the contiguous regions.

Evaluation of EU Cohesion Policies within the scope of Lisbon and Europe 2020 Strategies

In order to increase the level of integration and development at the scale of the Union and to raise the conditions of competition on a global scale, EU has announced two basic development strategies within the process: Lisbon Strategy (2000) and the Europe 2020 Strategy (2010). Though the EU 2000-2006 Cohesion Policies corresponding to the 2000-2006 fiscal period and 2007-2013 Cohesion Policy Program that was reformed in comparison to the previous program were prepared within the scope of the Lisbon Strategy, 2014-2020 financial program and Cohesion Policies have been produced within the context of EUROPE 2020 Strategy. During the said process, the objectives and priorities as well as the budgets of the EU structural funds have changed. In March 2000, the European Council meeting in Lisbon set the strategic goal of transforming the EU into ‘the most competitive and dynamic knowledge-based economy in the world’ within a decade. Among the jointly agreed goals to be attained by 2010 were raising investment in research and development to three per cent of gross domestic product (GDP) and increasing the rate of employment within the EU from 61 to 70 per cent of the working-age population (Teasdale, 2012). Based on the interim evaluations of Lisbon Strategy, EU Commission stated that the required specific objectives could not be achieved because the financial crisis and planned reforms could not be implemented. At the same time, the major expansion in 2004 made the existing inter-regional disparities more evident. Published on 2010 by EC, Europe 2020 Strategy (which is considered to be a reviewed and updated Lisbon Strategy) brought in a new expansion in terms of achieving the initial objectives. The strategy in question focuses not only on the economic – social cohesion but also on spatial cohesion. However, the statistics within the process reveal that the economic, social and territorial cohesion could not be achieved at the scale of EU yet, even it has been asserted in a report, which was prepared by the Secretariat of the Conference of Peripheral Maritime Regions (CPMR) in 2015 that besides the disparities between the Member States, disparities between regions within countries increased, as well. Within the scope of this study, it will be discussed how much the cohesion target, given in the founding treaty of EU is reflected on the development strategies; the role and accomplishments of these strategies and funds in achieving that target. While the role and accomplishments of the Europe 2020 Strategy, which is still in effect today, are questioned in terms of ensuring particularly the territorial cohesion, also the importance and the priority granted to urban spaces in order to achieve the objectives of strategies - as well as objectives of the founding agreement – will be discussed. The Method of the Study can be summarized as the literature survey based on the Lisbon and Europe 2020 Strategies of European Commission, the EU Financial Period Programs and observations and critics prepared by a variety of institutions as well as the evaluation of the findings based on statistical datas.

Migration in response to climate change and its impact in China

PurposeClimate change will have a significant impact on China’s potential agricultural production and change the distribution of the population in various regions of China, thus producing population migration. This paper aims to analyze China’s population migration in response to climate change and its socio-economic impact.Design/methodology/approachIn this paper, the Potential Agriculture Production Index is introduced as an analytical tool with which to estimate the scale of the population migration induced by climate change. Also, this paper constructs a multi-regional computable general equilibrium (CGE) model and analyzes the effect of change in the population distribution pattern on regional economies, regional disparity and resident welfare.FindingsThe key finding of this paper is that, as a result of changes in potential agricultural production induced by climate change, the Circum-Bohai-Sea region, the industrialized region and the industrializing region, which are the main destination regions of the migrating population, will face a severe labor shortage. In response to population migration, the economic growth rate of the immigrating population regions has accelerated. Correspondingly, the economic growth rate of the emigrating population regions has decreased. In addition, the larger the scale of population migration is, the larger the economic impact is. Migration increases inner-regional disparity and decreases inter-regional disparity. However, overall regional disparity is only somewhat decreased.Originality/valueThis paper introduces a Potential Agriculture Production Index to estimate the scale of the population migration and introduce a multi-regional CGE model to analyze the correlated social-economic impacts.

Trends in the concentration of economic activity and disparities in Russia’s spatial development

The spatial distribution of economic activity in Russia is studied by quantitative methods and qualitative analysis. The characteristics of evolution of economic activity distribution have been obtained with an approach based on analysis of Markov chains and mobility indices. The study has shown that the processes of the spatial concentration of production continue to unfold in the modern Russian economy. In addition to preserving and strengthening positions of existing centers, it is possible to observe the formation of new ones and simultaneously a certain weakening of former resource centers. Analysis of the evolution of this distribution has demonstrated the presence of an active poverty trap and a wealth trap, as well as a tendency toward the formation of an intermediate group of federal subjects with regard to their economic activity level. With preserving trends of the study period, the final distribution of regions in terms of economic activity level shows the formation of a rather wide pole of relative poverty and a wealth pole that concentrates a significant share of produced value added. The emerging group of regions with the average level of development is relatively small. In such circumstances, regional policy aimed at stimulating developed regions only strengthens this polarization. We consider that a more sensible policy would be to reduce disproportions in territorial development in order to avoid excessive deepening of interregional disparities and inequality.

Sustainable cities in central and eastern European countries. Moving towards smart specialization

During the transition to the market economy the Central and Eastern European (CEE) countries were concerned with the creation of the legal and institutional framework for environmental preservation as an important component of sustainable development strategy, in line with the EU accession requirements. Nevertheless, without denying the efforts to create a real environmental culture, the economic and social problems like production decline and growing unemployment made public concern shift away to more immediately stressful issues such as real wages or job insecurity. Later on, in the post-accession period the Cohesion Policy created a more stimulating framework for dealing with the sustainable development objectives. In the current programme period, 2014–2020, in accordance with the “Europe 2020” Strategy, the sustainable growth is closely related to smart and inclusive growth within the strategic objective of the Cohesion Policy, offering each member state multiple instruments and funding opportunities for complying with sustainability criteria. They are particularly supportive for CEE countries, whose internal resources are below the required levels in this respect. This paper proposes a spotlight on the sustainability issues in CEE cities, considered development vehicles for the regions they belong to, and thus major participants in the efforts to promote economic growth and diminish interregional disparities. An evolutionary perspective is applied, aiming to reveal how these cities responded to sustainability requirements in both pre- and post-accession periods. In addition, we test the variance of green performance between different groups of CEE cities (Baltic, Central or East European cities; large, medium and small cities; growing, stagnating and declining cities). In the final part of the paper, a special emphasis is placed on the policies able to create synergies between smart specialization and sustainable development approaches. To this end, the paper investigates how sustainable and smart growth policies complement each other in supporting eco-innovation, eco-system services and resource efficiency at the city level in CEE countries. Meanwhile, the paper looks for those smart policy mixes that rationally combine knowledge-based investments in areas with competitive advantages and coherent support measures for a greener economy, as a pre-requisite for territorial cohesion and competitiveness in Europe.

Region-level obesity projections and an examination of its correlates in Quebec.

Regional public health policy-makers frequently adopt obesity programs and objectives that have been established at global, provincial/state or national levels. However, the presence of substantial inter-regional disparities could render this practice inefficient. Studies that collectively assess obesity prevalence, temporal trends and their heterogeneity at the region level are rare, though they could be used to support better regional surveillance and planning. To address this gap, our study projected obesity prevalence time series to 2023 for 16 health regions in Quebec. We also compared the extent to which yearly rates of increase (or slope) versus cross-sectional prevalence drove regional heterogeneity and correlated with obesity-related sociodemographic and behavioural characteristics. Projections were done using weighted compositional regression to fit and extrapolate obesity prevalence time series (1987-2012). Heterogeneity in obesity prevalence as a function of time and obesity slope were characterized using standard deviation. The correlation of region-level obesity prevalence and slope with 14 area-level obesity-related characteristics was assessed. Obesity prevalence is projected to increase in all regions. Region-level heterogeneity in prevalence in 2012 (σ = 2.2%) is projected to increase to (σ = 3.1%) by 2023. The increase in prevalence heterogeneity appeared to be driven by region-level heterogeneity in slope (β = 0.22%-0.51%/year). Obesity-related characteristics were found to be more strongly correlated with slope than with prevalence. Large area obesity trends mask substantial and increasing region-level disparities. Obesity slope appears to drive region-level heterogeneity and correlate strongly with explanatory factors, and may represent a pertinent metric for public health monitoring.

CT&I e desenvolvimento desigual no Brasil: é possível outro “modelo de desenvolvimento”?

O território brasileiro é marcado por desigualdades. Para promover a sua redução, o discurso dominante sugere maiores incentivos em Ciência, Tecnologia e Inovação [CT&I]. O objetivo deste artigo é examinar a relação entre os investimentos em CT&I e suas repercussões no território brasileiro, especificamente, quanto à diminuição das desigualdades socioeconômicas e das disparidades inter-regionais. Temporalmente, considerou-se o período recente (2000 a 2013). Geograficamente, usou-se o recorte das macrorregiões brasileiras. Mobilizaram-se indicadores socioeconômicos e dados sobre investimentos em CT&I. Os resultados evidenciam que as políticas de CT&I não vêm contribuindo para a diminuição das desigualdades socioeconômicas e disparidades regionais. A persistência dessas últimas acaba consolidando uma paisagem marcada pelo desenvolvimento geográfico desigual, alimentado por processos históricos de acumulação de capital. Em vista disso, sugere-se outro modelo de desenvolvimento, mais democrático, feito para e com as pessoas, baseado noutra matriz de CT&I, em que a tecnologia social deverá ganhar maior relevância.

Inter-Regional Disparity and the Possibility of Inter-Regional Solidarity: Reconsidering the Heisei Municipal Mergers

Inter-Regional Disparity and the Possibility of Inter-Regional Solidarity: Reconsidering the Heisei Municipal Mergers

Spatial differentiation of GDP and unemployment in Poland and Italy with its determinants

The paper aims to identify the scale of spatial differentiation of GDP per capita and unemployment rate in Poland and Italy, as well as to indicate changes in the differentiation trends. The research was carried out at the level of Polish voivodships and Italian regions, forming the territorial units NUTS 2. The elementary methods of descriptive statistics and spatial econometrics (fixed effects) were applied for the research purpose. Data for the years 2002—2014, published by the CSO, Italian National Institute of Statistics (Istat) and Eurostat, were used for the analysis. The results of the research show that Poland and Italy are characterized by a similar, high level of regional diversity of GDP per capita. On the other hand, differences in the level of unemployment among Italian regions are much higher than among Polish voivodships. It was also stated that the differences in examined macroeconomic measures within the two countries are increasing, which in turn can lead to growing inter-regional disparities in the level of development.

Pengaruh Infrastruktur dan Keterkaitan Spasial Terhadap Konvergensi Beta di Indonesia

Motivated inter-regional disparities condition that occurs persistently, this thesis examines the Indonesian economy in the long run, whether it will tend to converge or diverge. This convergence is based on the Solow Neoclassical growth theory which assumes the existence of diminishing returns to capital so that when the developed countries reach steady state conditions, developing countries will continuous growth up to ‘catch-up‘ with developed countries. This thesis also focuses on the influence of spatial dependency and infrastructure since regional economics perspective, each region can not be treated as a stand-alone unit. Economical and political situation of a region will influence policy in that region which will also have an impact to the neighboring regions. The estimation results of spatial cross-regressive model using fixed effect method consistently confirmed that the Indonesian economy in the long term will likely converge with a speed of 8.08 percent per year. Other finding is, road infrastructure has a positive effect on economic growth and investment and road infrastructure are spatially showed a positive effect on economic growth. In other words, the investment and the infrastructure of a region not only affect the economic growth of that region but also to the economy of the contiguous region.

The impact of intergovernmental transfer funds on interregional income disparity in Indonesia

ABSTRACTThe purpose of this paper is to identify the impact of intergovernmental transfer funds on interregional income disparity in Indonesia after reforms by the administration towards fiscal decentralization. Household income data from 2006 and 2011 are used to generate interregional and intraregional income inequality index data. It is found interregional income disparities are affected by intergovernmental transfer funds, physical and human capital, employment, agglomeration, industrialization, openness, and geographical location. Intraregional income inequalities in rich provinces and poor provinces both have positive effects on interregional income disparity. If a central government increases the intergovernmental transfer fund to the rich province by 1%, this widens the interregional income disparity by 0.68%. An increase of the intergovernmental transfer fund to poor provinces by 1% is expected to reduce the interregional income disparity by 1.06%.