 Is There A Trade-off Between Regional Growth and National Income? Theory and Evidence from the EUNo 1008, School of Economics Discussion Papers from School of Economics, University of Surrey Abstract: The paper theoretically and empirically investigates the effect of changes in national labourmarket conditions on regional growth from the point of view of local economies. The mechanism of efficiency wage is introduced to a growth model and it is argued that local regions belonging to richer countries would experience slower economic growth than those in poorer countries, ceteris paribus. The model emphasises the process of interregional wage dependence in which national average wage or income plays an important role in determining regional wages and growth. The empirical findings from EU regional data also suggest that national income is significantly and negatively associated with regional growth. The adverse effect of national income on regional growth is also observed to be stronger among richer regions whose income is above the national average. Keywords: Artificial Neural Networks; Forecasting; Inflation (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:sur:surrec:1008 Access Statistics for this paper More papers in School of Economics Discussion Papers from School of Economics, University of Surrey Contact information at EDIRC. |
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