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Regional Externalities And Growth: Evidence From European Regions

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Author Info
Enrique López-Bazo
Esther Vayá
Manuel Artís

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Abstract

This paper models externalities of production across regional economies. Under the assumption that knowledge diffuses without political or administrative barriers, we derive externalities that affect the steady state and the process of growth of each economy. The empirical counterpart of the reduced form equation summarizing the process of growth allows us to test for the presence of regional spillovers and to measure their magnitude. Our results for a sample of European regions show that spillovers are far from negligible, are robust to the consideration of variables within each region, and may cause nondecreasing returns at the spatial aggregate level. The paper also relates previous empirical evidence on spatial dependence in growth studies to the externalities modeled here. Copyright Blackwell Publishers, 2004

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File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1085-9489.2004.00327.x
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Publisher Info
Article provided by Blackwell Publishing in its journal Journal of Regional Science.

Volume (Year): 44 (2004)
Issue (Month): 1 ()
Pages: 43-73
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Handle: RePEc:bla:jregsc:v:44:y:2004:i:1:p:43-73

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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0022-4146

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  1. Julie LE GALLO (IERSO, IFReDE-GRES) & Sandy DALL’ERBA (REAL, University of Illinois at Urbana-Champaign), 2004. "Evaluating the Temporal and the Spatial Heterogeneity of the European Convergence Process, 1980-1999," Working Papers of GRES - Cahiers du GRES 2004-23, Groupement de Recherches Economiques et Sociales. [Downloadable!]
    Other versions:
  2. Georgios Fotopoulos, 2005. "Twin - Peaks in E.U. Regional Productivity Dynamics: a nonparametric analysis," Discussion Papers on Entrepreneurship, Growth and Public Policy 2005-28, Max Planck Institute of Economics, Group for Entrepreneurship, Growth and Public Policy. [Downloadable!]
  3. Michael Pfaffermayr, 2007. "Conditional Beta- and Sigma-Convergence in Space: A Maximum Likelihood Approach," Working Papers 2007-17, Faculty of Economics and Statistics, University of Innsbruck. [Downloadable!]
  4. Philippe De Vreyer & Gilles Spielvogel, 2005. "Spatial externalities between Brazilian municipios and their neighbours," Working Papers DT/2005/11, DIAL (Développement, Institutions & Analyses de Long terme). [Downloadable!]
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  5. Martin Falk & Franz Sinabell, 2008. "The Effectiveness of Objective 1 Structural Funds in the EU 15: New Empirical Evidence from NUTS 3 Regions," WIFO Working Papers 310, WIFO. [Downloadable!]
  6. Sandy Dall'erba & Eveline Van Leeuwen, 2006. "Does Agricultural Employment Benefit From Eu Support?," ERSA conference papers ersa06p96, European Regional Science Association. [Downloadable!]
  7. Tiiu Paas & Friso Schlitte, 2006. "Regional Income Inequality and Convergence Processes in the EU-25," ERSA conference papers ersa06p229, European Regional Science Association. [Downloadable!]
  8. Nicolas Debarsy & Cem Ertur, 2006. "The European Enlargement Process and Regional Convergence Revisited: Spatial Effects Still Matter," ERSA conference papers ersa06p198, European Regional Science Association. [Downloadable!]
  9. Julie Le Gallo & Sandy Dall’erba, 2005. "Spatial And Sectoral Productivity Convergence Between European Regions, 1975-2000," ERSA conference papers ersa05p191, European Regional Science Association. [Downloadable!]
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  10. Roberto Basile, 2007. "Productivity polarization across regions in Europe," Quaderni del Dipartimento di Economia, Finanza e Statistica 9602, Università di Perugia, Dipartimento Economia, Finanza e Statistica. [Downloadable!]
  11. José María Mella Márquez & Coro Chasco Yrigoyen, 2004. "Urban growth and territorial dynamics in Spain (1985-2001): A spatial econometrics analysis," Urban/Regional 0411003, EconWPA. [Downloadable!]
  12. Cem Ertur & Wilfried Koch, 2006. "Regional disparities in the European Union and the enlargement process: an exploratory spatial data analysis, 1995–2000," The Annals of Regional Science, Springer, vol. 40(4), pages 723-765, December. [Downloadable!] (restricted)
  13. Philippe De Vreyer & Sandrine Mesplé-Somps & Gilles Spielvogel, 2005. "Spatial externalities between Brazilian municipios and their neighbours," ERSA conference papers ersa05p573, European Regional Science Association. [Downloadable!]
  14. Maria Abreu & Henri L.F. de Groot & Raymond J.G.M. Florax, 2004. "Space and Growth," Tinbergen Institute Discussion Papers 04-129/3, Tinbergen Institute. [Downloadable!]
  15. Matías Mayor & Ana López, 2008. "Spatial shift-share analysis versus spatial filtering: an application to Spanish employment data," Empirical Economics, Springer, vol. 34(1), pages 123-142, February. [Downloadable!] (restricted)
  16. Manfred Fischer & Claudia Stirböck, 2006. "Pan-European regional income growth and club-convergence," The Annals of Regional Science, Springer, vol. 40(4), pages 693-721, December. [Downloadable!] (restricted)
  17. Matías Mayor Fernández & Ana Jesús López Menéndez, 2005. "The spatial shift-share analysis - new developments and some findings for the Spanish case," ERSA conference papers ersa05p659, European Regional Science Association. [Downloadable!]
  18. Matias Mayor Fernandez & Esteban Fernandez Vazquez & Jorge Rodriguez Valez, 2006. "Spatial Structures and Spatial Spillovers: A GME Approach," ERSA conference papers ersa06p777, European Regional Science Association. [Downloadable!]
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