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Counterfactual Distribution Dynamics across European Regions

Davide Fiaschi (), Andrea Lavezzi () and Angela Parenti ()

Discussion Papers from Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy

Abstract: This paper proposes a methodology which combines elements of parametric regression analysis with the nonparametric distribution dynamics approach in order to analyse the role of some variables in the convergence of productivity across European regions over the period 1980-2002. We find that the initial productivity crucially accounts in the convergence process across European regions. Differently, employment growth seems not to play a role, while the Structural and Cohesion Funds seem to play a positive role, even though such effect seems to be very low and statistically significant only at the low bound of the range of initial productivity. The structural change of regional economies plays a positive role, but such e effect is statistically significant only for the least productive regions. The output composition of a region in 1980 a effects the convergence process of productivity growth in several ways. In particular, the share of non market services on output acts like a source of convergence from 1980 to 2002 but in the long-run it plays a negligible role. Finally, the share of finance acts like a force of divergence across European regions, especially for the least productive regions.

Keywords: European regional policy; structural change; convergence; European regions. (search for similar items in EconPapers)
JEL-codes: C21 E62 R11 O52 (search for similar items in EconPapers)
Date: 2009-06-19
New Economics Papers: this item is included in nep-eec, nep-eff and nep-geo
Note: ISSN 2039-1854
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Persistent link: https://EconPapers.repec.org/RePEc:pie:dsedps:2009/85

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