The spatial distribution of wealth: A search for hot spots

Abstract

This chapter gives an exploratory description of the spatial distribution of relative local tax bases and private wealth as well as the growth rate in these variables across Swedish municipalities during the period 1992–2013. The main aim is to test the hypothesis that municipalities with relatively high tax bases and high private wealth, such as relative capital incomes or private property values and changes in these variables, are more spatially clustered than could be caused by pure chance. The chapter is purely descriptive where we make use of two frequently used statistical tests for spatial correlation, the global Moran’s I and the local G* i (d)-statistic, as well as maps to identify what we refer to as regional ‘hot spots’. That is, clusters of municipalities with high local tax bases and private wealth in combination with high growth rates in these variables. This chapter also serves as a guide to how the global Moran’s I and the local G* i (d)-statistic could be used with application to the spatial distribution of local tax bases and private wealth across Swedish municipalities. Even though this paper focuses on local tax bases and private wealth, the method applied could of course be used to identify other types of clusters such as industrial clusters, clusters of individuals and/or industries with specific human capital and knowledge, different types of crimes, etc.