Kilts or inequality

On 18 September, Scotland may vote for independence. My understanding is that the referendum isn’t necessarily about kilts and haggis, but rather about left-leaning Scots who are fed up with London’s neoliberal policies. Policies that have caused, among other things, a widening gap between the rich and the rest of society. In fact, the Scottish referendum has been called the «world’s first vote on economic inequality».

One way in which inequality manifests itself is geographically. An interesting question is whether income and political power coincide. In some countries such as Germany and the Netherlands, the seat of government is in a region with a GDP comparable to the rest of the country. More often, governments are in high-income regions. For example, France’s richest region is Hauts-de-Seine (with business district la Défense), followed on its heels by Paris itself. Both have a GDP almost three times as high as the national GDP.

But the widest gap is to be found in the UK. Across Europe, only three out of 1357 regions have a GDP per inhabitant that is more than 3 times as high as their national GDP. For Polish boomtown Warsaw, the ratio is just above 3. For the German region of Wolfsburg, where VW has its headquarters, the ratio is 3.4. But the list is headed by the UK, where the «Inner London - West» region has a GDP as much as 5.8 times as high as the national GDP.

All in all, Scots who are dissatisfied with the distribution of income in the UK clearly have a point. Should the No camp find itself looking for someone to blame on 19 September, then perhaps Ms. Thatcher might qualify.

Map of all of Europe here.

Method

I used Eurostat data on gross domestic product per inhabitant by NUTS 3 regions in 2011. NUTS 3 are the smallest regions used by Eurostat and have populations ranging from 150,000 to 800,000. 2011 is the most recent year for which data are available. The map is from EuroGeographics. The R code for the analysis is available here.

Of course, comparing regional GDP to national GDP is just one way of measuring inequality; other measures may produce somewhat different outcomes. It would be interesting to use wealth rather than income data, but I doubt that wealth data are available for regions.