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Borders prevent the optimal exploitation of socio‐economic and environmental resources. A relevant obstacle due to missed integration is associated with legal and administrative barriers, which cause the emergence of untapped potentials. This paper exploits the case study of the Interreg Central Europe programme. Removing borders among countries in the area enhances scale economies due to a large market for inputs and goods, both within regions and across Central European area regions. This paper identifies untapped potentials by looking at the missed regional GDP growth due to the inefficient exploitation of regional growth assets. Results hint at a complex and heterogeneous spatial distribution of untapped potentials, involving several growth factors. [ABSTRACT FROM AUTHOR]

The paper applies the modern portfolio theory and stochastic frontier analysis to gross value added growth rates in Europe and presents evidence of convex growth‐instability frontiers. Using their national accounts by economic activity, numerical simulations of gross value added shares show that in 2011, industry portfolios were below Markowitz's efficient frontier and that rearranging the share of economic activities lead to efficiency gains in terms of lower output instability and higher growth rates. Gross value added in EU countries in general, and core countries in particular, should be contributed by the "service provider" and "financial activities" sectors, while optimal industry portfolios of periphery countries are more diversified. Stochastic frontier analysis confirms the convex growth‐instability frontiers and finds that technical inefficiencies are explained by differences in the growth rate of labour and the degree of industrial diversification. Getting more efficient is a combination of country characteristics and sector specifics, where efficiency gains are inversely related to industrial diversification during economic development. Reported results are robust to model specifications and data restrictions. [ABSTRACT FROM AUTHOR]

This paper analyses the determinants of regional economic growth in the European Union adopting a non-parametric approach. Although the local-linear kernel estimator applied does not explicitly take into account the spatial dimension of the data, it is found to be consistent in our context. In addition, the geographically weighted regression turns out to be less efficient. We obtain evidence of a non-linear relationship between regional growth and its determinants in the form of parameter heterogeneity and threshold effects. These non-linearities mainly affect the initial productivity of labour, the human capital endowment and, as a novelty, the level of infrastructures. [ABSTRACT FROM AUTHOR]

This paper provides a spatial vector autoregressive (SpVAR) analysis of growth spillovers for the Spanish regions over the period 1965-2003. First, a spatial Granger causality analysis is performed that indicates the relevant impact of spatial spillover effects across regions in Spain. Second, the empirical research offers a contribution in the context of the SpVAR modelling estimating the push-in (from the neighbours to the region) and push-out (from the region to its neighbours) effects of growth spillovers within a regional economic system. Finally, the proposed methodology reveals empirical evidence about both the short-run and long-term regional growth adjustment processes in space and time. The results for the Spanish regional panel data suggest the existence of strong spatiotemporal regional spillovers of growth output. This has important implications for the choice of regional policy goals and regional policy instruments. [ABSTRACT FROM AUTHOR]

This paper investigates whether related variety, among other types of spatial externalities, affected regional growth in Spain at the NUTS 3 level during the period 1995-2007. We found evidence that related variety matters for growth across regions, especially when using two new methods that measure revealed relatedness between industries. The first method is based on Porter's cluster classification while the second method uses the proximity index proposed by Hidalgo et al. Our analyses show that Spanish provinces with a wide range of related industries tend to show higher economic growth rates, once we control for other determinants of growth. Este artículo investiga si la variedad relacionada, entre otros tipos de externalidades espaciales, afectó el crecimiento regional en España a nivel NUTS 3 durante el periodo 1995-2007. Hallamos pruebas de que la variedad relacionada influye en el crecimiento entre regiones, especialmente al utilizar dos métodos nuevos que miden el grado de conexión manifiesto entre industrias. El primer método está basado en la clasificación de conglomerados de Porter, mientras que el segundo método utiliza el índice de proximidad propuesto por Hidalgo et al. Nuestros análisis muestran que las provincias españolas con un amplio rango de industrias relacionadas tienden a mostrar tasas de crecimiento económico más altas, una vez que se logra controlar otros factores determinantes del crecimiento. [ABSTRACT FROM AUTHOR]

The standard growth model predicts that allowing labour mobility across regions would increase the speed of convergence in per capita income levels and that migration has a negative causal impact on regional growth rates. Although the empirical literature has uncovered some evidence for the former implication, the latter has not been verified empirically. This paper provides empirical evidence for the negative causal impact of migration on provincial growth rates in a developing country with a high level of internal migration characterized by unskilled labour exiting rural areas for urban centres. We utilize an instrumental variables estimation method with an instrument unique to the country examined, controlling for provincial fixed effects. Resumen El modelo de crecimiento estándar predice que el permitir la movilidad laboral entre regiones aumentará la rapidez en alcanzar una convergencia en los niveles de ingresos per cápita y que la migración tiene un impacto causal negativo en las tasas de crecimiento regionales. Aunque la literatura empírica ha descubierto alguna prueba de la primera implicación, la última no ha sido verificada empíricamente. Este artículo proporciona pruebas empíricas del impacto causal negativo de la migración en las tasas de crecimiento provinciales en un país en desarrollo con una elevada migración interna caracterizada por mano de obra no cualificada desplazándose de las áreas rurales a los centros urbanos. Utilizamos un método de estimación de variables instrumentales con un instrumento único para el país examinado, al tiempo que controlamos los efectos fijos provinciales. [ABSTRACT FROM AUTHOR]

Economic disparities between the regions of the European Union are of constant concern both for policy and economic research. In this paper, we examine whether there are overlapping trends of regional development in the EU: overall convergence, on the one hand, and persistent or even increasing spatial concentration (agglomeration), on the other. Kernel density estimation, Markov chain analysis and cross-sectional regressions provide evidence that convergence of regional per-capita income in the EU15 has become considerably stronger in the 1990s. The reduction of income disparities, however, is a phenomenon between nations but not between regions within the EU countries. European integration (and possibly European regional policy) fosters the catching-up of lagging countries but at the same time forces towards agglomeration of economic activities tend to increase disparities within the EU member states. Resumen. Las disparidades económicas entre regiones de la Unión Europea son una preocupación constante para la investigación relacionada con políticas y con economía. En este artículo examinamos si existen tendencias superpuestas de desarrollo regional en la UE: convergencia en términos generales, por un lado, y por otro una concentración espacial (aglomeración) continua o incluso en aumento. La estimación por núcleos ( kernel) de la función de densidad, el análisis mediante cadenas de Markov y las regresiones transversales aportan pruebas de que la convergencia de ingresos regionales per cápita de la UE15 se ha fortalecido considerablemente en la década de los noventa. La reducción en la disparidad de ingresos, sin embargo, es un fenómeno entre naciones pero no entre regiones dentro de países de la UE. La integración europea (y quizá la política regional europea) fomenta la puesta al día de los países rezagados pero al mismo tiempo las fuerzas conducentes a la aglomeración de actividades económicas tienden a aumentar las disparidades dentro de los estados miembros de la UE. [ABSTRACT FROM AUTHOR]

The work discussed in Bivand and Brunstad (2003 ) was an attempt to throw light on apparent variability in regional convergence in relation to agriculture as a sector subject to powerful political measures, in Western Europe, 1989–1999. The present study takes up a number of points made in conclusion in that paper. Since it is possible that the non-stationarity found there is related to further missing variables, including the inadequacy of the way in which agricultural subsidies are represented, we attempt to replace the agriculture variables with better estimates of producer subsidy equivalents. It is also sensible to check that agricultural support is not masking or masked by other variables, for example human capital. The article is also an account of the development of software contributed to the project ( Development Core Team, 2005 ) as packages, in particular the spdep package for spatial econometrics. New functions generously contributed by researchers will be presented and compared. We find that agricultural support does impact regional economic growth after human capital is taken into consideration, and that we can show that apparent non-stationarity is alleviated by adding these variables.We further find that the moderated remaining spatial autocorrelation can best be represented by a substantive spatial lag model. [ABSTRACT FROM AUTHOR]

Using a panel of 265 regions from 24 OECD countries from 1997 to 2007, we explore the impact of nation‐wide macroeconomic and structural policies on the productivity growth of subnational regions. We find that average relationships between nation‐wide policies and regional productivity growth can hide strong differentiated effects according to the distance to the frontier: relaxing employment protection legislation on temporary contracts, lowering barriers to trade and investment and increasing trade openness enhances productivity growth in lagging regions, whereas reducing barriers to entrepreneurship or higher levels of government debt has a positive effect on regions closer to the productivity frontier. [ABSTRACT FROM AUTHOR]

Given the increasing share of the EU budget devoted to Regional Policy, several studies have tried to identify the impact of structural funds on economic growth. However, so far no consensus has been reached. We assess Regional Policy effects through a non-experimental comparison group method, the regression discontinuity design, and a novel regional dataset for the 1994-2006 period. We exploit the allocation rule of EU transfers by comparing regions with a per capita GDP level just below the eligibility threshold (75% of EU average) with those just above. Our findings show a positive impact of EU Regional Policy on economic growth. [ABSTRACT FROM AUTHOR]

The new economic geography (NEG) has become a mainstay of regional science in the last two decades, as signified by the awarding of Paul Krugman, the Nobel Prize. Yet, most American regional scientists and urban/regional economists do not use NEG in determining regional growth patterns. Instead, they rely on factors such as natural amenity migration, whose roots lie back to the work of Philip Graves in the mid 1970s. Conversely, two of the world's leading economic geographers – Allen Scott and Michael Storper – have strongly argued that job availability not household amenities have determined US regional dynamics. Given the disparity of views over the largest developed economy in the world, we hold a competition to determine which of these leading contenders accurately predict US interregional growth dynamics over the last 40–60 years. The runaway winner of the duel is natural amenity led growth with the crown going to Graves. Implications are drawn for both empirical research and EU economic integration. [ABSTRACT FROM AUTHOR]

In modern economic growth theory, R&D and the subsequent production of new knowledge are the driving forces for long-term regional growth. Empirical evidence, however, does not always support this popular belief in the regional context. Using a simple growth accounting model, this study examines the role of R&D in regional growth. Estimation results from the proposed models show that knowledge commercialization and retention factors, such as entrepreneurship, university research, human capital, social capital, and industry structure, play significant roles in the regional R&D appropriation mechanism. Findings from this study suggest that R&D policy needs to be designed to take into account other regional factors. [ABSTRACT FROM AUTHOR]

This article develops a growth-based regionalisation of the United States using both principal components and cluster analyses to endogenously sort states into regional transition clubs with somewhat uniform annual rates of per capita real GSP growth in the period 1977–2004. I correlate the principal components with annual growth in per capita real GDP and assess spatial dependencies in the identified transition clubs. Growth variability in the transition clubs is compared with growth variability in BEA and Census regions. Results show a large Coastal transition club that contains most of the New England, Middle Atlantic, and South Atlantic census regions. California, Minnesota, and Arizona belong to this grouping. A second growth transition club titled Eastern Interior groups most of the states in the East North Central and the East South Central census regions. A Western Interior region groups states in the southern Great Plains. Coefficients of variation show that these three large interstate groupings grow more uniformly compared with associated census and BEA regions. Growth in western states is idiosyncratic. Most western states group with one or two related states, California and Arizona associate with the Coastal club, Nevada does not pigeonhole well with other states, and Alaska's annual growth trajectory is unique. Este artículo desarrolla una regionalización de los Estados Unidos basada en crecimiento usando componentes principales y análisis de cluster para agrupar los estados en grupos de transición regional según tasas anuales de crecimiento más o menos uniformes en el producto estatal bruto (GSP) real per capita en el periodo 1977–2004. Correlaciono los componentes principales con el crecimiento anual en el producto interior bruto (GDP) real per capita y evalúo dependencias espaciales en los grupos de transición identificados. La variabilidad de crecimiento en los grupos de transición se compara con la variabilidad de crecimiento en regiones BEA (Bureau of Economic Analysis) y Censuales. Los resultados muestran un grupo de transición grande en la Costa que contiene la mayoría de regiones censuales de New England, Atlántico Medio, y Atlántico Sur. California, Minnesota, y Arizona pertenecen a este grupo. Un Segundo grupo de transición de crecimiento llamado Interior Este aglutina la mayoría de estados de las regiones censuales Central Norte Oriental y Central Sur Oriental. Una región Interior Occidental agrupa los estados de las Grandes Llanuras del Sur. Los coeficientes de variación muestran que estos tres grandes grupos interestatales crecen más uniformemente en comparación con las regiones censuales y BEA asociadas. El crecimiento en los estados occidentales es idiosincrásico. La mayoría de los estados occidentales se agrupan con uno o dos estados relacionados, California y Arizona se asocian con el grupo de la Costa, Nevada no se clasifica bien con ningún otro estado, y la trayectoria de crecimiento anual de Alaska es única. [ABSTRACT FROM AUTHOR]

This article argues that using either the SIC or NAICS one-digit classifications as a method of aggregating two- and three-digit time series data can ignore important regional characteristics. We present a pairwise cointegration approach of aggregation where the aggregated sectors can vary widely across regions. By systematically constructing region-specific sectors from more detailed industries, we find that the level of agglomeration across rural and urban areas can affect the composition and number of local sectors in a region. We use the results pointing to rural/urban geographic distinctiveness to further consider the Carlino and Defina (1998, 1999 ) finding that monetary policy has disparate effects across regions in the U.S. Este artículo postula que el uso de las clasificaciones de una cifra SIC o SCIAN-NAICS como método de agregación de datos de series temporales de dos y tres cifras puede llevar a ignorar características regionales importantes. Presentamos un método de cointegración por pares en el que los sectores agregados pueden variar ampliamente entre regiones. Mediante la construcción sistemática de sectores específicos por región de industrias más detalladas, encontramos que el nivel de aglomeración entre áreas rurales y urbanas puede afectar la composición y número de sectores locales en una región. Usamos los resultados que indican la diferenciación geográfica rural/urbana para considerar la propuesta de Carlino y Defina (1998, 1999) de que la política monetaria tiene efectos marcadamente distintos entre regiones de los EE.UU. [ABSTRACT FROM AUTHOR]

Inter-regional spillover effects are central to China's growth policy; yet relatively little is known about the strength and duration of these spillovers and whether their characteristics have changed over time. This article examines the spillover of output between the three commonly considered regions of China: coastal, central and western regions. We find that there are strong spillovers from the coastal region to both other regions, from the central region to the western region, but that shocks to the western region have no flow-on effect on the other two regions. Thus, a policy of developing the coastal region is likely to indirectly benefit the other two regions. Our results suggest surprisingly little change in the pattern of spillovers over the period 1953–2003, although parameter instability in the beginning of the period limits the extent of possible analysis of this issue. [ABSTRACT FROM AUTHOR]

This article reviews where we have come from and where we are going in research on regional growth and development. Our object of study is the region, an imprecise term that has been taken to mean areas as large as small countries or as small as urban regions, although how regions are defined does itself have implications for both theories and the empirics of regional growth. How growth occurs remains a poorly understood process. Clearly the basic ingredients of the neo-classical cookbook are important--growth in capital and labour stocks with technological change--but they are neither enough nor revealing enough. Why does the stock of capital grow at different rates? Why does the labour supply increase? What drives technical progress? What are the roots of spatial dependence? We are fairly certain that the answers to these questions embrace agglomeration economies but they also embrace much more. Innovation is associated with research and development and has an identifiable spatial pattern in relation to highly skilled labour and institutions such as universities. But innovation is not just the result of R&D but also entrepreneurship applied to investment. Labour supply responds to real wage differentials but also to environmental and other amenities. Labour is far more geographically mobile in the New World, however, than it is in the Old. [ABSTRACT FROM AUTHOR]