Regional Convergence in Europe and the Role of Urban Agglomerations
AbstractUsing data for EU-27 NUTS 2 regions and major cities, we evaluate empirically the role of urban growth spillovers as a determinant of income dynamics at the regional level. We go beyond the empirically well documented static relationship between national income and productivity in urban agglomerations. We use spatial regression models to quantify the effect of city growth spillovers on neighboring regions and assess the interrelationship between urban and regional growth. Our results indicate that urban growth spillovers play an important role in explaining differences in per capita income growth across European regions: Strong income growth in urban agglomerations provides an additional growth bonus for neighboring regions. This effect is very homogeneous across regions in Western and Eastern Europe. Our results indicate that the industrial composition of the agglomeration also matters for regional growth: Regions hosting urban agglomerations with a relatively high specialization in the primary sector as well as in fuels and chemicals tend to experience lower rates of economic growth. Our study is particularly relevant for policymakers since it indicates a trade-off between fostering income convergence at the regional level on the one hand and spurring national growth on the other hand.
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Bibliographic InfoArticle provided by Oesterreichische Nationalbank (Austrian Central Bank) in its journal Focus on European Economic Integration.
Volume (Year): (2010)
Issue (Month): 3 ()
Postal: Oesterreichische Nationalbank, Documentation Management and Communications Services, Otto-Wagner Platz 3, A-1090 Vienna, Austria
Find related papers by JEL classification:
- C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
- R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- O52 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Europe
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Jesus Crespo Cuaresma & Doris Ritzberger-Grunwald & Maria Antoinette Silgoner, 2008.
"Growth, convergence and EU membership,"
Taylor & Francis Journals, vol. 40(5), pages 643-656.
- Jesus Crespo Cuaresma & Martin Feldkircher, 2009.
"Spatial Filtering, Model Uncertainty and the Speed of Income Convergence in Europe,"
2009-17, Faculty of Economics and Statistics, University of Innsbruck.
- Jesús Crespo Cuaresma & Martin Feldkircher, 2013. "Spatial Filtering, Model Uncertainty And The Speed Of Income Convergence In Europe," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 28(4), pages 720-741, 06.
- Feldkircher, Martin & Cuaresma, Jesús Crespo, 2010. "Spatial Filtering, Model Uncertainty and the Speed of Income Convergence in Europe," Working Papers 160, Oesterreichische Nationalbank (Austrian Central Bank).
- Doppelhofer, Gernot & Feldkircher, Martin & Cuaresma, Jesús Crespo, 2009. "Economic Growth Determinants for European Regions: Is Central and Eastern Europe Different?," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue 3.
- Henri L.F. de Groot & Jacques Poot & Martijn J. Smit, 2008. "Agglomeration Externalities, Innovation and Regional Growth: Theoretical Perspectives and Meta-Analysis," Working Papers in Economics 08/01, University of Waikato, Department of Economics.
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