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Spatial convergence

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  • Peter Egger
  • Michael Pfaffermayr

Abstract

. This article analyses the consequences of spatial interdependence for convergence in a Solow‐type growth model. In such a model a region's speed of convergence depends on its location and it can be decomposed into: (i) the speed of convergence proper, (ii) the remoteness effect, and (iii) the impact of the initial gap. Also σ‐convergence is affected by spatial interaction and we propose a decomposition to isolate the impact of spatial spillovers. Using GDP per capita of European regions, we calibrate a numerical model with parameters typically found in spatial convergence studies. We find that the remoteness effect leads to considerable variation in the speed of convergence while it marginally affects σ‐convergence.

Suggested Citation

  • Peter Egger & Michael Pfaffermayr, 2006. "Spatial convergence," Papers in Regional Science, Wiley Blackwell, vol. 85(2), pages 199-215, June.
    • Handle: RePEc:bla:presci:v:85:y:2006:i:2:p:199-215
    DOI: 10.1111/j.1435-5957.2006.00084.x
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    References listed on IDEAS

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    1. Cem Ertur & Wilfried Koch, 2007. "Growth, technological interdependence and spatial externalities: theory and evidence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(6), pages 1033-1062.
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