Domestic or export: What is basic at the NUTS 2 regional level? A spatial endogenous regional growth model applied in the EU

Pascal Ricordel ()
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Pascal Ricordel: EDEHN - Equipe d'Economie Le Havre Normandie - ULH - Université Le Havre Normandie - NU - Normandie Université

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Abstract: A common statement found in regional policy reports is that regional growth is an "export or die" issue. However, the succession of disruptions in the international supply chain has highlighted the crucial roles of domestic activities, local markets and short supply chains, turning the environmental and resilience challenge present in growth policy into a "domestic or die" issue. Recent regional growth theories have seriously questioned export activity as the only way in which to drive regional growth and have highlighted the crucial role of the domestic sector. However, no empirical study has assessed the roles of the domestic and export sectors in growth during this troubled economic period, despite the usefulness of this information for nonbiased policy decisions. Using a spatial endogenous regional growth model as a framework, we investigate the role of the domestic sector during the 1999–2014 period for 263 European Union (EU) Nomenclature of Territorial Units for Statistics (NUTS) regions. The results stress the importance of domestic productivity for regional growth during this period, which is characterized by three economic shocks, thereby elucidating the importance of domestic productivity for competitiveness and resilience issues.

Keywords: domestic export sectors economic base theory endogenous growth model regional Dutch disease regional growth regional resilience spatial model; domestic export sectors; economic base theory; endogenous growth model; regional Dutch disease; regional growth; regional resilience; spatial model (search for similar items in EconPapers)
Date: 2024-02-06
New Economics Papers: this item is included in nep-eec, nep-eur, nep-geo, nep-int, nep-mac and nep-ure
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Published in Growth and Change, 2024, 55 (1), ⟨10.1111/grow.12707⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04841821

DOI: 10.1111/grow.12707

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