Multi-speed Europe is already there: Catching up and falling behind.

• The existence of a remarkable heterogeneity among groups of countries within the EU. • The southern periphery has been falling behind, eastern countries have been catching up. • The evolution of research or innovation indicators do not provide conclusive information. • Re-positioning of each peripheral EU country in the Germany-centred productive chain. • Strikingly different performances in productivity between the two less advanced groups. This paper looks at a set of European countries, addressing the issue of different performances (in various indicators) within the European Union integrated framework. The selected countries are divided into four groups, also considering their relation with the industrial core of Europe, namely Germany. Firstly, we highlight the wide heterogeneity between them with respect to GDP per capita and labour productivity. Secondly, we point to a similar heterogeneity in indicators which are generally considered representative for the performance in innovative activities. At this point, we investigate whether any process of convergence has taken place in the past two decades among these groups of countries. By applying a standard methodology on all the indicators we are able to distinguish different patterns: the southern periphery is falling behind, the eastern periphery is catching up. Finally, we move to the different patterns in productivity dynamics: through a shift-share analysis, we uncover the paramount relevance of the growth in the productivity within sectors, and we analyze the paths of structural change and the connected shifts of workers among sectors, which result to be partially accountable for such different performances. [ABSTRACT FROM AUTHOR]