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The COVID-19 shock on the labour market: Poverty and inequality effects across Spanish regions

Author

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  • C. Palomino, Juan
  • G. Rodríguez, Juan
  • Sebastian, Raquel
Abstract
We evaluate the distributional consequences of social distancing for the case of Spanish regions. Under 2 months of lockdown plus 10 months of partial functioning our study consistently finds potential wage losses that are sizeable and uneven across the wage distribution all around Spain, but with different intensity depending on the region's productive structure. The increase of the headcount poverty index oscillates between 8.2 (Navarre) and 19.2 (the Balearic Islands) percentage points, while the Gini coefficient rises between 2.3 (Navarre) and 5.3 (the Balearic Islands) Gini points. We also find that inequality between regions increases, eroding regional cohesion in Spain.

Suggested Citation

  • C. Palomino, Juan & G. Rodríguez, Juan & Sebastian, Raquel, 2021. "The COVID-19 shock on the labour market: Poverty and inequality effects across Spanish regions," INET Oxford Working Papers 2021-06, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford.
    • Handle: RePEc:amz:wpaper:2021-06
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    File URL: https://www.inet.ox.ac.uk/files/covid-19-shock-spanish-regions-pov-ineq-jan-2021.pdf
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    References listed on IDEAS

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    1. Simon Mongey & Laura Pilossoph & Alexander Weinberg, 2021. "Which workers bear the burden of social distancing?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(3), pages 509-526, September.
    2. Dingel, Jonathan I. & Neiman, Brent, 2020. "How many jobs can be done at home?," Journal of Public Economics, Elsevier, vol. 189(C).
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    4. Ravallion, Martin & Chen, Shaohua, 2003. "Measuring pro-poor growth," Economics Letters, Elsevier, vol. 78(1), pages 93-99, January.
    5. Goolsbee, Austan & Syverson, Chad, 2021. "Fear, lockdown, and diversion: Comparing drivers of pandemic economic decline 2020," Journal of Public Economics, Elsevier, vol. 193(C).
    6. Foster, James E. & Shneyerov, Artyom A., 2000. "Path Independent Inequality Measures," Journal of Economic Theory, Elsevier, vol. 91(2), pages 199-222, April.
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    Cited by:

    1. Vanina Adoriana Trifan & Komalpreet Kaur, 2022. "Understanding the Effects of the Russia-Ukraine Conflict on the Global Economy," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(1), pages 180-184, September.

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    More about this item

    Keywords

    COVID-19; poverty; inequality; teleworking; social distancing; regions; Spain;
    All these keywords.

    JEL classification:

    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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