Sara Torregrosa Hetland

Sticky income inequality in the Spanish transition (1973-1990)

This paper investigates the evolution of income inequality in Spain during its transition to democracy, suggesting a method for the correction of under-reporting of earnings and profits in the Household Budget Surveys’ data. The contribution is twofold: the methodological proposal, based on income-expenditure discrepancy and scaling-up to National Accounts, improves on previous work, and can be convenient for similar historical sources in other countries. Secondly, its application results in an alternative history of the distribution of income in this case, changing the levels and also the observed trend. Previous literature asserted a substantial equalization, related to the democratization process, while after the adjustment inequality in disposable income is shown to have been quite persistent.

Limits to Redistribution in Late Democratic Transitions: The Case of Spain

This chapter reviews the experience of one country from the European periphery, Spain, in the period 1960 to 1990. It addresses the possibilities to build up an operative welfare state after recent democratization—past the golden age of economic growth in Western economies, and during the second globalization. The new context made it difficult to develop determined redistributive policies where they had been absent before. Economic distress, increasing capital mobility, and new tax ideas challenged the chances of progressive taxation. Furthermore, the recent dictatorship cast long-lasting shadows in the new representative institutions. This study of the Spanish experience is thus an analysis of time-specific and polity-specific constraints on redistribution, which other new democracies might have faced or could encounter in the near future.

Nuevas perspectivas en la investigación docente de la historia económica

One of the most significant changes in the university legislation approved in Bologna was the impulse of the practical classes at degree studies. The combination of theoretical and practical elements would reinforce the range of knowledge that the university students would obtain in the context of a common European education. Though in some matters the practical education was coming being a habitual matter, in others could have supposed a challenge for the teachers. In the present communication we present some examples of practices and fieldwork realized in the subjects of Economic History, but also with multidisciplinary character, which reinforces the common bows with other related matters. The idea was born in a Project of Educational Innovation of the University of Valladolid.

Political transition and fiscal transition in Spain

After the tax reform undertaken in Spain between 1977 and 1986, the practical results in terms of progressivity and redistribution were not outstanding. Inequality did not significantly decrease after the transition to democracy, as political economy literature would suggest. In recent times, the system has shown its incapacity to sustain European-level welfare services. But why?This paper analyses the main contenders which might explain the issue: ideologies and the decision-making institutions. Perhaps the general citizen – or the decisive voter – was not so keen on redistribution. Alternatively, the political system may not translate effectively the public stances onto policies. Some of these elements were significantly modified during the political transition. Others were affected by international developments, such as the general change of emphasis from equity to efficiency in tax system design, and the higher capacity of capital to escape from taxation, by means of mobility.

Bypassing progressive taxation: fraud and base erosion in the Spanish income tax (1970-2001)

In this paper I estimate under-assessment of incomes in the Personal Income Tax during the years following its introduction in Spain. The methodology combines an analysis of discrepancy with National Accounts and an econometric exercise, which follows and slightly modifies the Feldman and Slemrod (2007) procedure, based on the relation of reported charitable donations with the composition of income in tax micro-data. Both calculations show that concealment of income differed substantially across sources and levels, with better compliance at the bottom of the distribution of taxpayers. Because of this, fraud made the tax less progressive than it was on paper. Compliance improved over the next decades, but the overall levels were still far from those attained in developed countries, because of lack of administrative capacity or political will to enforce the new regulation. In this way, general, comprehensive income taxation was hardly a reality 20 years after its introduction.

A Fiscal Revolution? Progressivity in the Spanish tax system (1960-1990)

The main objective of this paper is to calculate the distribution of the tax burden across income levels in Spain between 1960 and 1990. The chosen period covers the final years of Franco’s dictatorship and the first ones of the present parliamentary regime, and is thus meant to explore how political change was reflected on taxation. Does transition entail a fiscal revolution? Here is one case study developed and compared to other national experiences. Effective tax reform seems to have been politically blocked during the dictatorship, with public budgets growing fundamentally on the grounds of social security contributions. Democracy brought about a comprehensive transformation starting in 1977, which aimed at improving fairness (progressivity) and increasing revenue (to fund the development of the Welfare State). In this work I analyze whether the reforms entailed effective changes in the distribution of the tax burden, by imputing tax collection to taxpayers, based on income and consumption micro-data from Household Budget Surveys. The results show a persistent (albeit decreasing) regressivity in the tax system, which caused an increasingly negative redistribution of income. Pre-Tax incomes grew unequal during the period and net incomes even more so as a result: the tax reform did not fulfill its equalizing promises. The joint effect of the fiscal system, however, seems to have been slightly positive due to progressive social spending.