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“Factor Accumulation, Externalities and Absorptive Capacity in Regional Growth: Evidence from Europe”

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Author Info

  • Juan Jung

    ()
    (Faculty of Economics, University of Barcelona)

  • Enrique López-Bazo

    ()
    (Faculty of Economics, University of Barcelona)

Abstract

This paper proposes a model which incorporates capital accumulation and spatial spillovers across economies, while allowing for regional differences in absorptive abilities. This model is estimated using a sample of 215 European NUTS2 regions, before and after the 2004 enlargement of the single??market area. Results confirm the relevance of local absorptive capacities, as are found to be directly linked with the process of making the most of externalities. More than that, capital accumulation externalities do not seem to take place in absence of local capabilities. The process of capital deepening which took place in the period reduced the role of capital in explaining the productivity gap among regions, but so far has not been enough to help lagging regions to equal the return to human capital investments reached by most advanced regions.

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File URL: http://www.ub.edu/irea/working_papers/2014/201416.pdf
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Bibliographic Info

Paper provided by University of Barcelona, Regional Quantitative Analysis Group in its series AQR Working Papers with number 201409.

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Length: 31 pages
Date of creation: May 2014
Date of revision: May 2014
Handle: RePEc:aqr:wpaper:201409

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Related research

Keywords: Regional Disparities; Absorptive Capacity; Technological Interdependence; Spatial Econometrics. JEL classification: C21; O10; R11;

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