Published on Wednesday, February 26, 2020

Spain | Regional convergence elusive in the recovery

Regional convergence has been slow during the recovery. Lower income regions are creating employment at high rates but their low productivity growth is a burden. Attracting investment, reducing employment procyclicality and policies aimed at improving demographic dynamics would boost convergence.

Key points

  • Key points:
  • The recovery that began in 2013 is characterized by a slower convergence in GDP per capita among the Autonomous Communities than that observed in the expansion between 2000 and 2008
  • Productivity has contributed to regional divergence in this recovery, while in the previous expansion it had favoured convergence
  • This occurs despite the fact that lower-income regions are decreasing their unemployment rate at a higher pace in the post-crisis period than higher-income regions
  • Economic policies aimed at raising productivity growth, improving investment and reducing employment procyclicality in lower income regions would foster convergence
  • Policies aimed at improving the demographic dynamics in lower income communities will favour the reduction of disparities between CC. AA.

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