WHO CARES ABOUT REGIONAL INEQUALITIES? EFFECTS OF FISCAL CONSOLIDATION

Vinko MUSTRA

Assistant professor Faculty of Economics, University of Split, Cvite Fiskovića 5, 21000 Split, Croatia

vmustra@efst.hr

Abstract

The most recent global economic crisis and the concerns about long-term (un)sustainability of public finances has supported the implementation of budgetary consolidation measures. Although there are relatively large number of papers investigating the impact of fiscal consolidation on different aspect of economy this paper represent unique attempt of investigating the effects of fiscal consolidation on regional inequalities. We test the hypothesis that in the period of fiscal consolidation, when some spending cut and/or tax hikes, less developed regions are not in position to protect themselves against undesired redistributive policies which put them in more disadvantaged position and increase regional inequalities. In empirical part of the paper we explore the impact of fiscal consolidation on regional inequalities on national levels among 13 EU member countries for period 1995-2009. Two groups of variables are particularly important for this study: measure of regional inequality and fiscal consolidation. Due to fact that recent literature recognizes problems with using cyclically-adjusted primary budget balance (CAPB) as a measure for fiscal consolidation we extend regional empirical literature by using a new database of fiscal consolidation that successfully tackles all this issues. The results indicate that fiscal consolidation led by tax hikes increases regional inequalities and that fiscal consolidation led by spending cuts doesn’t have significant influence on regional inequalities. Finally, the paper highlights that fiscal consolidation is not only the matter of the public debt levels or economic growth, but also important regional issue.

Keywords: Regional inequalities, Fiscal consolidation, European Union

JEL classification: R12, E62, H23

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LIVE HERE…? NO, THANK YOU! MIGRATION AND ITS CAUSES IN MOENCHENGLADBACH – A CITY FOR LIVING AND WORKING

Rüdiger HAMM

Head of the Niederrhein Institute for Regional and Structural Research (NIERS) at the Niederrhein University of Applied Sciences in Moenchengladbach, Germany, Richard-Wagner-Straße 140, 41065 Moenchengladbach, +4921611866411

ruediger.hamm@hs-niederrhein.de

Geogr. Katja KEGGENHOFF

Research Assistant at the Niederrhein Institute for Regional and Structural Research (NIERS) at the Niederrhein University of Applied Sciences in Moenchengladbach, Germany, Richard-Wagner-Straße 140, 41065 Moenchengladbach, +4921611866424, katja.keggenhoff@hs-niederrhein.de

Angelika JAGER

Research Assistant at the Niederrhein Institute for Regional and Structural Research (NIERS) at the Niederrhein University of Applied Sciences in Moenchengladbach, Germany, Richard-Wagner-Straße 140, 41065 Moenchengladbach, +4921611866432, angelika.a.jaeger@gmail.com

The original version of this document was drafted in German and published in the journal RaumPlanung 185 / 3-2016 of the `Informationskreis für Raumplanung e.V.´ (IfR).

Abstract

One of the essential tasks and goals of local policy makers and administrations is to provide a high quality of life and work for citizens and employees in a specified location. This especially applies in times of demographic change, in which cities are increasingly facing the challenge of an aging and shrinking population in the inter-municipal competition. Hence, key questions arise, such as: Which factors determine choice of location of private households? How are these factors evaluated in the living and working area of Moenchengladbach? In order to answer these questions, in a first step the migration processes of the city of Moncheng-ladbach are examined based on secondary statistics. In a second step, three primary statistical sur-veys are conducted in order to reveal information on which crucial factors influence the choice of residence for the observed migration processes and how the quality of Moenchengladbach as a resi-dential location is evaluated.

Keywords: Migration, Urban development, Locational factors, Citizens’ satisfaction, Job mobility

JEL classification: R21, R32

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THE CHAOTIC UNEMPLOYMENT RATE GROWTH MODEL: EURO AREA

Vesna D. JABLANOVIC

Professor of Economics, University of Belgrade, Faculty of Agriculture, Nemanjina 6 , 11081  Belgrade, Republic of Serbia

vesnajab@ptt.rs

Abstract

The unemployment rate in the Euro Area fall to 10.026 per cent in 2016. Among the Member States, the lowest unemployment rates were recorded in Germany and Malta. On the other hand, the highest unemployment rates were observed in Greece and Spain. Unemployment rates have fallen from their postcrisis peaks, but remain high.  The basic aims of this paper  are: firstly,  to provide a relatively simple chaotic unemployment rate growth model that is capable of generating stable equilibria, cycles, or chaos, and secondly, to to analyze the unemployment rate growth stability in the period 1991-2015 in the Euro Area.. This paper confirms stable growth of the unemployment rate in the Euro Area in the observed period.

Keywords: Unemployment rate, Economic Growth, Euro Area

JEL classification: J64, 040, 052

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