Regional Asymmetries and Local Finances: A Cluster Analysis

Authors

DOI:

https://doi.org/10.59072/rper.vi68.567

Keywords:

cluster analysis, local finance, regional analysis

Abstract

The economic, population and social dimensions of the Portuguese regions are analyzed, because demographic issues and inequalities and social cohesion are important strategic challenges for the Portuguese economy. Some indicators of local public finances and electoral participation are also studied to assess their possible impact on socio-economic cohesion. This analysis is even more pressing in the current context, given the need to rethink the political choices between “guns and butter”, without compromising the sustainability of public finances. Using cluster analysis and a set of 13 variables, related to two years of analysis, 2009 and 2019, we identify four groups of territorial units (NUTS III) that have similar economic, population and social characteristics. The significant differences between the clusters in relation to local public finances indicators allows two important conclusions: the poorest and most aged regions are the most dependent on government transfer payments per capita and, therefore, on future policy choices regarding to the weight of intergovernmental transfers in total public expenditure; and abstention in municipal elections seems to be lower in declining regions and when voters are more dependent on the state.

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Published

15-05-2024

How to Cite

Martins, P., & Oliveira, I. (2024). Regional Asymmetries and Local Finances: A Cluster Analysis. RPER, (68), 137–159. https://doi.org/10.59072/rper.vi68.567