Abstract
This paper performs an assessment and imputation of the benefits produced to the individuals and households well-being by the public services provision. This analysis is very relevant in the current framework of economic crisis of the European economies. Although most of the papers in the literature compare countries, decentralization processes are included in this paper by accounting the effect of public expenditure on regional health care and education upon the levels of inequality and rates of poverty in each Spanish region. This case is relevant because of the high decentralization degree of the Spanish political structure and the persistent regional disparities. The results show a clear downward tendency in both phenomena following imputation, although education shows a greater impact. Furthermore, a decomposition, used in this context for the first time, of the effects shows the very relevant redistributive effect of this public expenditure.
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Notes
Navarro and Hernández (2004) offer a review of the studies of the effect of health expenditure published in Spain.
The Annex offers data on health expenditure per person, the protected population, expenditure per student and the number of students for each region in 2005 and 2009.
While the data on education expenditures are related to the calendar year, the data on students by education level are related to the academic year. Therefore, the number of students in 2005 is computed by the weighted average of students in the academic year 2004–2005 and 2005–2006.
Source: Institute of Evaluation. State system of education indicators. 2011 edition. The previous data correspond to the academic year 2008–2009. http://www.mecd.gob.es/inee/sistema-indicadores.html.
This is doubtless caused by the important difference between the average income in Extremadura and the national average.
Since poverty after imputation is determine by the 60 % of the median equivalent extended income, the imputation of public education increases the poverty line. Therefore, some people living in households with no children and low income who are slightly above the line before fall below the threshold after imputation.
To obtain the true values, the annual averages of the CPI are employed, by using 2011 as the base year, for the years 2005 and 2009, provided by the National Statistics Institute.
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The authors acknowledge financial support from the Junta de Extremadura and European Regional Development Fund (ERDF) (PRI08A137).
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Jurado, A., Perez-Mayo, J. & Pedraja, F. The Impact of Public Services Expenditure on the Spanish Income Distribution. Soc Indic Res 127, 217–241 (2016). https://doi.org/10.1007/s11205-015-0957-y
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DOI: https://doi.org/10.1007/s11205-015-0957-y