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In the last year, a central issue in regional economic growth debate has been represented by the empirical analysis of Verdoorn's law related to the long-term dynamic relationship between the rate of growth in output and the productivity growth due to increasing returns. Several papers have tested Verdoorn's law on European countries as well as many other world economies. Recently, attempts have been made to provide foundations for a spatial version of the original law specification. The main contributions were dedicated to the inclusion of spatial dependence in the economic model. Surprisingly, in the literature on Verdoom's law the analysis of the spatial heterogeneity is not often considered. The aim of this paper is the regional analysis of the spatial dependence and heterogeneity in Verdoorn's law, identifying spatial regimes that can be interpreted as clusters of productivity growth in European regions at NUTS 2 level. To pursue this objective, an optimization algorithm for the identification of groups is used. This constitutes a modified version of Simulated Annealing. [ABSTRACT FROM AUTHOR]

This paper examines the degree to which creative industries stimulate regional productivity growth in a developing country, Indonesia. The Indonesian government promotes long-established 'traditional' craft businesses as creative industries, but they pay less attention to new knowledge creation and focus on highlighting heritage values as selling points. Our findings show that the 'real' creative industries are still scarce and found mostly in fairly advanced urban regions. These industries are more likely to be an indicator than a driver of regional economic development. Meanwhile, those traditional businesses are much larger than creative industries and potentially contribute to regional productivity through consumption activities, thereby requiring different policy strategies. [ABSTRACT FROM AUTHOR]

Abstract This paper analyzes the productivity growth of the Spanish regions between 1965 and 1995, decomposing productivity gains into technological progress and efficiency change by means of Malmquist indices. Once estimates of efficiency are obtained, the aim of this paper is to analyze the effects of human and public capital on growth in terms of their impact on Total Factor Productivity (TFP). Public capital is believed to increase the productivity of the private factors of production whereas human capital is thought to contribute to the production process as an additional input and to have a dynamic influence on growth through its impact on technological innovation (shifts in the production frontier) and technological diffusion (movements toward the frontier), which are the components of this TFP measure. Considering inefficiencies will then allow the effects of these variables on TFP growth to be estimated via technological progress and efficiency gains. [ABSTRACT FROM AUTHOR]