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Kaldor's Laws and Spatial Dependence: Evidence for the European Regions

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  • Jordi Pons-Novell
  • Elisabet Viladecans-Marsal

Abstract

PONS-NOVELL J. and VILADECANS-MARSAL E. (1999) Kaldor's laws and spatial dependence: evidence for the European regions, Reg. Studies 33, 443-451. In this paper we provide an outline of Kaldor's growth model and test its relevance to the economic experience of European regions during the period 1984-92. Kaldor's first law asserts that manufacturing is the engine of economic growth. His second proposition, also known as Verdoorn's law, states that there is a strong positive relation between manufacturing productivity growth and manufacturing output growth. Kaldor's third law holds that overall productivity growth is positively related to manufacturing output growth, and negatively related to employment in non-manufacturing sectors. The empirical results, corrected for the presence of spatial autocorrelation, indicate that Kaldor's second and third laws are compatible with the economic growth of European regions during the period 1984-92. PONS-NOVELL J. et VILADECANS-MARSAL E. (1999) Les lois de Kaldor et la dependance geographique: des preuves provenant des regions europeennes, Reg. Studies 33, 443-451. Cet article fournit une esquisse du modele de croissance de Kaldor et evalue sa pertinence pour l'experience economique des regions europeennes de 1984 a 1992. La premie ¤ re loi de Kaldor affirme que l'industrie est le moteur de la croissance economique. La deuxieme loi, connue aussi sous le nom de la loi de Verdoorn, affirme que la croissance de la productivite industrielle est en correlation positive avec la croissance de la production industrielle. La troisieme loi de Kaldor affirme que la croissance globale de la productivite est en correlation positive avec la croissance de la production industrielle et en correlation negative avec l'emploi dans les secteurs hors de l'industrie. Les resultats empiriques, corriges pour autocorrelation spatiale, montrent que les deuxieme et troisieme lois de Kaldor sont compatibles avec la croissance economique des regions europeennes de 1984 a 1992. PONS-NOVELL J. und VILADECANS-MARSAL E. (1999) Kaldors Gesetze und raumliche Abha ¨ngigkeit: Beweise fur die europaischen Regionen, Reg. Studies 33, 443-451. Mit dem vorliegenden Aufsatz stellen die Autoren eine Ubersicht uber Kaldors Wachstumsmodell vor, und prufen seine Relevanz fur die Wirtschaftserfahrungen der europaischen Regionen im Zeitraum 1984-1992. Kaldors erstes Gesetz behauptet, Herstellung sei das Zugpferd wirtschaftlichen Wachstums. Seine zweite Aussage, die auch unter der Bezeichnung Verdoorns Gesetz bekannt ist, stellt fest, dass zwischen der Zunahme der Herstellerproduktivitat und dem Anstieg der Ertragsleistung eine durchaus positive Beziehung bestehe. Kaldors drittes Gesetz ist der Ansicht, dass die Gesamtzunahme der Produktivitat sich positiv zum Anstieg der Ertragsleistung verhalt, doch negativ zur Beschaftigung in nicht-herstellenden Sektoren. Die auf das Vorhandensein raumlicher Autokorrelation hin korrigierten, empirischen Ergebnisse deuten darauf hin, dass Kaldors zweites und drittes Gesetz mit dem wirtschaftlichen Wachstum europaischer Regionen im Zeitraum 1984-1992 vereinbar ist.

Suggested Citation

  • Jordi Pons-Novell & Elisabet Viladecans-Marsal, 1999. "Kaldor's Laws and Spatial Dependence: Evidence for the European Regions," Regional Studies, Taylor & Francis Journals, vol. 33(5), pages 443-451.
    • Handle: RePEc:taf:regstd:v:33:y:1999:i:5:p:443-451
    DOI: 10.1080/00343409950081284
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    8. Dong Guo & Sandy Dall’erba & Julie Le Gallo, 2013. "The Leading Role of Manufacturing in China’s Regional Economic Growth," International Regional Science Review, , vol. 36(2), pages 139-166, April.
    9. Gisela Di Meglio & Jorge Gallego & Andrés Maroto & Maria Savona, 2015. "Services in Developing Economies: A new chance for catching-up?," SPRU Working Paper Series 2015-32, SPRU - Science Policy Research Unit, University of Sussex Business School.
    10. Valeriy V. Mironov & Liudmila D. Konovalova, 2019. "Structural changes and economic growth in the world economy and Russia," Russian Journal of Economics, ARPHA Platform, vol. 5(1), pages 1-26, April.
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    14. Reinhold Kosfeld & Christian Dreger, 2006. "Thresholds for employment and unemployment: A spatial analysis of German regional labour markets, 1992–2000," Papers in Regional Science, Wiley Blackwell, vol. 85(4), pages 523-542, November.
    15. Fernando López & Jesús Mur & Ana Angulo, 2014. "Spatial model selection strategies in a SUR framework. The case of regional productivity in EU," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 53(1), pages 197-220, August.
    16. Julie Le Gallo & Antonio Páez, 2013. "Using Synthetic Variables in Instrumental Variable Estimation of Spatial Series Models," Environment and Planning A, , vol. 45(9), pages 2227-2242, September.
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    19. Tregenna, Fiona, 2011. "Manufacturing Productivity, Deindustrialization, and Reindustrialization," WIDER Working Paper Series 057, World Institute for Development Economic Research (UNU-WIDER).
    20. Justin Doran & Bernard Fingleton, 2018. "US Metropolitan Area Resilience: Insights from dynamic spatial panel estimation," Environment and Planning A, , vol. 50(1), pages 111-132, February.
    21. Sandy DALL’ERBA & Rachel GUILLAIN & Julie LE GALLO, 2009. "Impact Of Structural Funds On Regional Growth: How To Reconsider A 9 Year-Old Black Box," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 30, pages 77-100.
    22. Mark Roberts & Mark Setterfield, 2010. "Endogenous Regional Growth: A Critical Survey," Chapters, in: Mark Setterfield (ed.), Handbook of Alternative Theories of Economic Growth, chapter 21, Edward Elgar Publishing.
    23. Mark Setterfield (ed.), 2010. "Handbook of Alternative Theories of Economic Growth," Books, Edward Elgar Publishing, number 12814.
    24. Marconi, Nelson & Reis, Cristina Fróes de Borja & Araújo, Eliane Cristina de, 2016. "Manufacturing and economic development: The actuality of Kaldor's first and second laws," Structural Change and Economic Dynamics, Elsevier, vol. 37(C), pages 75-89.

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