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This paper investigates the extent to which the gap in total factor productivity between small and large firms is due to differences in the endowment of factors determining productivity and to the returns associated with these factors. We place particular emphasis on the contribution of differences in the propensity to innovate and in the use of skilled labor across firms of different size. Empirical evidence from a representative sample of Spanish manufacturing firms corroborates that both differences in endowments and returns to innovation and skilled labor significantly contribute to the productivity gap between small and large firms. In addition, it is observed that the contribution of innovation to this gap is caused only by differences in quantity, while differences in returns have no effect; in the case of human capital, however, most of the effect can be attributed to increasing differences in returns between small and large firms.

In this paper, we explore the connection between labor market segmentation in two sectors, a modern protected formal sector and a traditional- unprotected-informal sector, and overeducation in a developing country. Informality is thought to have negative consequences, primarily through poorer working conditions, lack of social security, as well as low levels of productivity throughout the economy. This paper considers an aspect that has not been previously addressed, namely the fact that informality might also affect the way workers match their actual education with that required performing their job. We use micro-data from Colombia to test the relationship between overeducation and informality. Empirical results suggest that, once the endogeneity of employment choice has been accounted for, formal male workers are less likely to be overeducated. Interestingly, the propensity of being overeducated among women does not seem to be closely related to the employment choice.

This paper reviews the theoretical arguments for understanding the process of the creation of a European identity. We discuss the mechanisms and determinants driving citizens' identification with Europe, stressing the role of territory in European identity formation. More precisely, our focus is on the literature that considers the link between European identity and EU policies that influence the socioeconomic conditions in general and Cohesion Policy in particular. This is a major policy within the EU that accounted for some 350 billion euros invested in the 2007-2013 programming period, or about one-third of the EU budget. Consequently, Cohesion Policy is expected to determine the way citizens identify with the European project in the regions benefitting more and less by the policy. The study also considers arguments supporting an urban-rural divide in European identity, which could interact with the influence of the Cohesion Policy. Initial descriptive evidence of these links is provided based on results from a comprehensive survey of 15 EU member states

Cohesion Policy is the main policy tool of the European Union and the backbone of its regional policy. Given its characteristics, it is the EU policy with the greatest impact on the daily life of European citizens and can compensate population groups and places less favoured by the European integration process. As a result, the implementation of Cohesion Policy in a region is expected to shape the degree of regional support for the process of European integration. This study tests this assumption using regional data for the EU28 in a period that includes the recent phases of expansion and recession, in a scenario characterized by growing anti-EU rhetoric. The results suggest that a greater amount of EU funds spent in the region does not stimulate regional support for the Union. However, an appropriate temporal distribution of the resources allocated to the region could have a positive effect on support.

This study analyses the impact of growth (in absolute and relative terms) of the European regions on the attitudes towards the European Union (EU) of their citizens. It does so in a period of socio-economic turbulence caused by the financial and sovereign debt crises, the accession to the Union of countries of Central and Eastern Europe, and the spread of anti-European rhetoric. In a first stage, regional indicators of support for and trust in the EU are calculated from the microdata of several Eurobarometer surveys. They confirm interesting changes in the regional distribution of citizens’ attitudes during the period analysed, which vary between the two indicators. In a second stage, these indicators are merged with data on regional growth to assess the impact of the latter on citizens’ perception of the EU. The results suggest that support for and trust in the EU are more widespread in regions with a dynamic economy. This positive impact of growth remains significant and sizeable after controlling for several economic characteristics of the region. However, the impact of regional growth on attitudes towards the EU is not the same in all regions. The effect of support and trust is more intense in regions with per capita income above the EU average.

This paper analyses the incidence of broadband on regional productivity in Brazil, intending to find out if the economic impact is uniform across all territories of the country. The possibility of performing a regional approach to test the effect of broadband on productivity in an emerging country represents a novelty for the literature. Results suggest that the impact of broadband on productivity is positive although not uniform across regions. On the one hand, it seems to depend on connection quality and network effects. Faster download speed and critical-mass accounting for network externalities in the region enhance the economic impact of broadband. On the other hand, higher productivity gains are estimated for the less developed regions. The fact that the less productive regions in Brazil seem to be benefiting more from broadband may suggest that it can constitute a factor favoring regional convergence in the country.

This paper reviews the theoretical arguments provided by the extant literature for understanding the process of creation of a European identity. We discuss the grounds of mechanisms and determinants driving citizens’ identification with Europe, stressing the role of the territorial dimension on European identity formation. More precisely, our focus is on the literature that have considered the link between European identity and EU policies that influence the citizens’ socio-economic conditions, in general, and Cohesion Policy in particular. This is a major policy within the EU that accounted for some 350 billion euros in the 2007-2013 programming period, about a third of total EU budget. Consequently, it is expected to determine the way citizens identify with the European project, both in the regions more and less benefited by the policy. The study also considers arguments supporting a sort of urban-rural divide in European identity, which could interact with the influence of the Cohesion Policy. Initial descriptive evidence on these links is provided based on results from a comprehensive survey for 15 EU member states., Este artículo revisa los argumentos teóricos proporcionados por la literatura existente para comprender el proceso de creación de una identidad europea. Discutimos los fundamentos de los mecanismos y determinantes que impulsan la identificación de los ciudadanos con Europa, destacando el papel de la dimensión territorial en la formación de la identidad europea. En concreto, nos centramos en la literatura que ha considerado el vínculo entre la identidad europea y las políticas de la UE que influyen en las condiciones socioeconómicas de los ciudadanos en general, y en la Política de Cohesión en particular. Ésta es una política importante dentro de la UE, que representó unos 350 mil millones de euros en el período de programación 2007-2013, aproximadamente un tercio del presupuesto total de la UE. En consecuencia, es de esperar que determine la forma en que los ciudadanos se identifican con el proyecto europeo, tanto en las regiones más y menos beneficiadas por la política. El estudio también considera argumentos que respaldan una división rural-urbana en la identidad europea, que podría interactuar con la influencia de la Política de Cohesión. La evidencia descriptiva inicial de estas conexiones se proporciona en base a los resultados de una encuesta exhaustiva para 15 estados miembros de la UE.

Does the perception of the EU vary across countries and regions? To what extent has the support for European integration and citizens’ attitudes towards the EU in regions with different socio-economic contexts evolved? Are they affected by the Cohesion Policy? More specifically, does the perception of the EU vary with the intensity of the policy in the region and with the effectiveness in which the funds allocated are finally spent? Is there a relationship between the deviation in funds’ allocations and actual expenditures, and the socio-economic characteristics of the region? Finally, are citizens in growing and, particularly, converging regions more prone to support the European project and have positive attitudes towards the EU?

Why individuals identify with Europe? In the absence of direct personal experiences with the EU and with people of other member states, how can the identification with the European project be developed? Despite the great number of EU competences, legislation and policy programmes, they are mostly implemented by member states. Are these EU policies amplifying citizens’ exposure to the idea of the EU? And finally, are citizens aware of the aims and perceive the benefits of the Cohesion Policy? If so, does it contribute to strengthen the shared political values under the European Social Model and, consequently, is it a driver of the identification with Europe? Giving answer to these questions is the main objective of this deliverable. This work tries to give some light to answer, at least partially, these questions by means of a key assumption. For most people in Europe, their experience with the EU takes place in the national political arena. In fact, one of the major EU policies is the Cohesion Policy that accounts for some 350 billion euros in the 2007-2013 programming period, about a third of total EU budget. Still, this policy is managed mostly locally. When individuals think on Europe they usually do it from a local point of view. The consequences of European integration depend not only on EU policies but also on how national, regional and local governments manage them. The Cohesion Policy is basically a regional development policy. Consequently, the territorial dimension is a key aspect that needs to be considered. In fact, most imbalances in economic and social (e.g. education) terms take place within every country and even within every region. In this respect, the perception of the Cohesion Policy and their impact on the development of a European identity could well vary between individuals in rural and urban areas. Therefore, we provide a specific look at the urban – rural divide of the way mechanisms and determinants impact on citizens’ European identification.

Why individuals identify with Europe? In the absence of direct personal experiences with the EU and with people of other member states, how can the identification with the European project be developed? Despite the great number of EU competences, legislation and policy programmes, they are mostly implemented by member states. Are these EU policies amplifying citizens’ exposure to the idea of the EU? And finally, are citizens aware of the aims and perceive the benefits of the Cohesion Policy? If so, does it contribute to strengthen the shared political values under the European Social Model and, consequently, is it a driver of the identification with Europe? Giving answer to these questions is the main objective of this deliverable.&nbsp

This paper analyses the incidence of broadband on regional productivity in Brazil, intending to find out if the economic impact is uniform across all territories of the country. The possibility of performing a regional approach, instead of the usual country-level analysis, means an opportunity to disentangle the economic impact of broadband at territories which share a common institutional and regulatory framework as are the regions inside a country. Results suggest that the impact of broadband on productivity is positive although not uniform across regions. On the one hand, it seems to depend on connection quality and network effects. Faster download speed and critical-mass accounting for netwo rk externalities in the region enhance the economic impact of broadband. On the other hand, higher productivity gains are estimated for the less developed regions. The fact that the less productive regions in Brazil seem to be benefiting more from broadband may suggest that it can constitute a factor favoring regional convergence in the country.

This paper tests three hypotheses regarding the link between internet and firm productivity: i) internet adoption and use constitute a source of productivity growth for firms in Latin America, ii) the intensity of its use also matters, and iii) the link between the new technologies and productivity levels is not uniform over the whole productivity distribution. The evidence in this paper fills the gap of scarce and fragmented literature focused on Latin America, and is aligned with previous research for more developed regions which has generally recognized that Information and Communication Technologies (ICTs) have radically changed how modern business are conducted, benefitting firm performances through several channels, such as increasing the efficiency of internal processes, expanding market reach or increasing innovation. Our findings suggest that low-medium productive firms benefit more from an expansion in internet adoption and use, in comparison with the most productive ones. If this evidence is supposed to reflect long-term effects, then public policies oriented to massify internet adoption and promote internet use intensively will surely contribute to reduce inequalities of enterprise’s productivity levels, promoting a level playing field among Latin American firms, something especially relevant for the most unequal region of the world.

Funding information: European Commission, Grant/Award Number: H2020-REFLECTIVE-SOCIETY-2015. Grant Agreement num; EC, Grant/Award Number: 693529, [eng] This work summarises the main findings of the review of the implementation of the Cohesion Policy in Extremadura (Spain) during the Operational Program 2007-2013, which closed early 2017. The PERCEIVE project, developed within the H2020 framework, gives the opportunity to analyse the characteristics of the region, its main strengths and weaknesses together with the opportunities and threats, and how the Cohesion Policy addresses these challenges. We perform a general overview of the Operational Program 2007-2013 in Extremadura, analysing the final expenditure by priority themes, the absorption rate, the time-line of the implementation and execution, and a comparison with the current 2014-2020 programming period. We also analyse the governance of Cohesion Policy in Extremadura and the institutional setting. We finish this report by summarising the main conclusions and the expected outcomes of the research project in its next stages., [spa] Este trabajo resume las principales conclusiones de la revisión de la Política de Cohesión en Extremadura (España) durante el Programa Operativo 2007-2013, que cerró a principios de 2017. El proyecto PERCEIVE, desarrollado dentro del marco H2020, brinda la oportunidad de analizar las características de la región, sus principales fortalezas y debilidades, junto con las oportunidades y ame - nazas, y cómo la política de cohesión aborda estos desafíos. Desarrollamos una visión general del Programa Operativo en el periodo 2007-2013 en Extremadura, analizando el gasto final por temas prioritarios, la tasa de absorción, el cronograma de implementación y ejecución y una comparación con el actual periodo de progra - mación 2014-2020. Asimismo, analizamos la gobernanza de la Política de Cohesión en Extremadura y el entorno institucional en la que se desarrolla. Terminamos este informe resumiendo las principales conclusiones y los resultados esperados del proyecto de investigación en sus siguientes etapas

Projecte: 2015PID-UB/013, El projecte s’ha aplicat als alumnes de les assignatures obligatòries d’Econometria I i II del Grau d’Economia de la Facultat d’Economia i Empresa al curs 2015-2016. Atesos els problemes de motivació habituals que presenten els alumnes del nostre Grau, especialment en matèries de perfil quantitatiu, el projecte ha perseguit l’objectiu general de fomentar la motivació del estudiants i l’aprenentatge actiu dels mateixos. Per tal d’aconseguir-ho vam pensar que seria possible incrementar aquesta motivació si els propis alumnes fossin la mostra estadística per l’anàlisi i aplicació de les tècniques economètriques ensenyades a classe. Així, es va pretendre motivar la participació dels alumnes mitjançant la reflexió sobre els factors determinants teòrics del seu propi rendiment acadèmic. Per fer-ho, s’ha recollit en primer lloc una base de dades dels propis alumnes sobre el seu rendiment acadèmic i les seves característiques sociodemogràfiques i familiars. Posteriorment, els alumnes han emprat aquesta base de dades per tal de construir un model economètric a partir del qual han aplicat les eines estadístic-economètriques estudiades a classe per tal d’aconseguir explicar el seu rendiment acadèmic. Atès que ells mateixos han estat la mostra d’anàlisi i el tema a analitzar era del seu interès, la participació ha estat molt elevada. Els resultats finals han sigut positius ja que ha incrementat la participació a classe i la reflexió conjunta del tema analitzat tant des d’un punt de vista teòric com aplicat. Alhora, han millorat els rendiment acadèmic general.

This paper investigates the role of regional determinants on innovation performance controlling by the firm’s absorptive capacity and other sources of firm heterogeneity. The findings for a sample of firms in Spain support the hypothesis that regional determinants matter, though their role is subtler than the one frequently assumed. Rather than a direct influence on firm’s innovation, the regional context moderates the effect of internal determinants. In the case of product innovation the most important mechanism of interaction seems to be operating through cooperation in innovation, whereas for process innovation it seems to be through highly skilled labour

This paper uses Colombian micro-data to analyze the role of education and informality on regional wage differentials. Our hypothesis is that apart from differences in the endowment of human capital across regions, regional heterogeneity in the incidence of informality is another important source of regional wage inequality in developing and emerging countries. This is confirmed by the evidence from Colombia, which in addition reveals remarkable heterogeneity across territories in the wage return to individuals’ characteristics. Regional heterogeneity in returns to education is especially intense in the upper part of the wage distribution. In turn, heterogeneity in the informal pay penalty is more relevant in the lower part.

This paper proposes a model which incorporates capital accumulation and spatial spillovers across economies, while allowing for regional differences in absorptive abilities. This model is estimated using a sample of 215 European NUTS2 regions, before and after the 2004 enlargement of the single??market area. Results confirm the relevance of local absorptive capacities, as are found to be directly linked with the process of making the most of externalities. More than that, capital accumulation externalities do not seem to take place in absence of local capabilities. The process of capital deepening which took place in the period reduced the role of capital in explaining the productivity gap among regions, but so far has not been enough to help lagging regions to equal the return to human capital investments reached by most advanced regions.

In this editorial, we summarise and comment on the five articles published in issue 9.2. The five articles are a selection of papers presented at the 'Workshop on Inequality and Regional Growth and Cohesion' organised by the Regional Quantitative Analysis research group (AQRIREA) of the University of Barcelona in November 2011. The first two articles, by De Dominicis and by Monastiriotis, focus on the analysis of regional growth and examine the influence of agglomeration and national development, respectively. The article by Ezcurra and Rodríguez-Pose looks instead at how trade openness impacts on within-country regional disparities, while the article by Kyriacou and Roca-Sagalés examines in turn how regional disparities impact on the quality of government at the national level. The final article by Sacchi and Salotti examines the impact of different forms of decentralisation on income inequalities at the household level. From our perspective, these articles contribute to a better understanding of the complex link between inequality and economic growth, while they also leave open several questions that could clearly stimulate future research on the topic.