a b s t r a c tThis paper studies the evolution of Spanish regional inequality from 1860 to 1930. The results point to the coexistence of two basic forces behind changes in regional economic inequality: industrial specialization and labor productivity differentials. The initial expan sion of industrialization, in a context of growing economic integration of regions, promoted the spatial concentration of manufacturing in certain regions, which also benefited from the greatest advances in terms of labor productivity. Since 1900, the diffusion of manufac turing production to a greater number of locations has generated the emulation of produc tion structures and a process of catching up in labor productivity and wages.

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This paper studies the evolution of Spanish regional inequality from 1860 to 2000. The results point to the coexistence of two basic forces behind changes in regional economic inequality: differences in economic structure and labor productivity across regions. In the Spanish case, the initial expansion of industrialization during the period 1860-1900, in a context of growing economic integration of regions, promoted the spatial concentration of manufacturing in certain regions, which also benefited from the greatest advances in terms of labor productivity. Since 1900 and until 1985, the diffusion of manufacturing and services production to a greater number of locations generated the emulation of production structures and a process of catching -up in labor productivity and wages. So, in these first 125 years, national market integration and economic growth has been followed by a Ushaped evolution of regional incomes inequality. Nevertheless, some productivity differentials remained and, from 1985 on, the Spanish entry in the UE generated a new upsurge of divergence in productivity across Spanish regions that could be in the base of a new phase of regional income divergence. Keywords: Industrialization; Market Integration; Heckscher-Ohlin Model; New Economic Geography. JEL Classification: N93; N94; R11. AbstractThis paper studies the evolution of Spanish regional inequality from 1860 to 2000. The results point to the coexistence of two basic forces behind changes in regional economic inequality: differences in economic structure and labor productivity across regions. In the Spanish case, the initial expansion of industrialization during the period 1860-1900, in a context of growing economic integration of regions, promoted the spatial concentration of manufacturing in certain regions, which also benefited from the greatest advances in terms of labor productivity. Since 1900 and until 1985, the diffusion of manufacturing and services production to a greater number of locations generated the emulation of production structures and a process of catching-up in labor productivity and wages. So, in these first 125 years, national market integration and economic growth has been followed by a U-shaped evolution of regional incomes inequality. Nevertheless, some productivity differentials remained and, from 1985 on, the Spanish entry in the UE generated a new upsurge of divergence in productivity across Spanish regions that could be in the base of a new phase of regional income divergence.

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This article contributes to the debate on institutions and economic development by examining the historical link between land access inequality and education. Using information from the 464 districts existent in mid-19 th century Spain, this paper confirms that there is a negative relationship between the fraction of farm labourers and male literacy rates. This result does not disappear when a large set of potential confounding factors are included in the analysis. The use of the Reconquest as a quasi-natural experiment allows us to rule out further concerns about potential endogeneity. In addition, controlling for different sources of spatial dependence does not explain away this result either. By analysing the rural-urban divide and the genderspecific information on the number of schools and teachers, as well as schooling enrolment rates, this paper also explores the mechanisms behind the observed relationship. As well as supply factors, our results show that demand effects also played a significant role in explaining the negative impact of inequality on education.