The European Coal Curse Revisited: Human Capital Deficit or Institutional Disfunction? Evidence from Spain

This paper investigates the long-term socioeconomic consequences of coal mining in Spain, revisiting the hypothesis of a European “coal curse.” Using novel municipal-level data on historical extraction and contemporary development indicators, it challenges the widespread assumption that former mining regions are economically disadvantaged. Unlike earlier regional-level studies, I find no income penalty for former coal municipalities; if anything, per capita income is marginally higher. Nor do these areas exhibit a generalized human capital deficit: levels of higher education attainment are similar to or greater than those in nonmining areas. However, this economic parity conceals deeper structural vulnerabilities—notably persistent population decline and growing reliance on pensions to sustain local incomes. Educational outcomes further complicate the narrative. The typical female advantage in higher education is muted or reversed in mining municipalities, likely reflecting the selective out-migration of highly educated women. This demographic imbalance may itself be understood as a form of institutional dysfunction, where weak local governance fails to create opportunities for retention and upward mobility. I provide additional evidence of institutional weakness by constructing a proxy for industrial land-use efficiency, revealing systematic gaps in the conversion of public investments into productive assets. Together, these findings suggest that the disadvantages observed in postcoal areas are driven less by cultural legacies and more by demographic pressures and weak institutional capacity. Spain’s case offers a microlevel complement to broader European studies, underscoring the value of spatially granular approaches to understanding the long-term legacies of resource dependence.