Economies of Scale and Cumulative Causation

Stilianos Alexiadis ()
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Stilianos Alexiadis: Ministry of Rural Development & Foods

Chapter Chapter 3 in Industrial Location and Vitalization of Regional Economy, 2023, pp 41-58 from Springer

Abstract: Abstract This paper examines ‘Verddorn’s Law’, i.e. the relation between employment and output growth across the NUTS-3 regions of the European Union. Moreover, an explanation is provided as to how ‘Verdoorn’s Law’ sets up a process of cumulative causation. Following the relevant literature, the empirical assessment is conducted using spatial econometric techniques. The empirical results provide considerable support to the validity of ‘Verdoorn’s Law’. A more detailed analysis suggests that differences in regional growth rates perpetuate a ‘dualistic’ situation Europe, with advanced regions growing at the expanse of less-developed regions.

Keywords: Cumulative Causation; Scale Economies; Regional Growth; R10 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-981-19-8128-9_3

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DOI: 10.1007/978-981-19-8128-9_3

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