We investigate urban GDP pc growth across the EU12 using data for functionally definedcities - rather than administrative regions. We test hypotheses on the role of human capital,EU integration and fragmentation of urban government and explore spatial dependence andmechanisms of spatial interaction. Results are acceptable on standard econometric testswithout measures of spatial interaction but there is spatial dependence. If variables reflectingspatial adjustment are included, they are statistically significant and eliminate spatialdependence. Not only do the results now provide consistent estimates of parameters, theyalso support relevant theoretical insights and show national borders are still significantbarriers to economic adjustment. People in Europe are sticky so it is unreasonable to assumespatial disparities will disappear. Our findings also imply that cities in Europe form nationalrather than a single continental system.
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Paper provided by Spatial Economics Research Centre, LSE in its series SERC Discussion Papers with number
0010.
Find related papers by JEL classification: H41 - Public Economics - - Publicly Provided Goods - - - Public Goods H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Regional, Urban, and Rural Analyses R11 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Analysis of Growth, Development, and Changes R50 - Urban, Rural, and Regional Economics - - Regional Government Analysis - - - General
References listed on IDEAS 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.:
Durlauf, Steven N. & Quah, Danny T., 1999.
"The new empirics of economic growth,"
Handbook of Macroeconomics,
in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 4, pages 235-308
Elsevier.
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