Returns to Scale for EU Regional Manufacturing
AbstractRecent theoretical advances have emphasised the importance of localised increasing returns to scale in understanding both the regional growth and agglomeration processes. However, considerable empirical controversy still exists over whether returns to scale are constant or increasing. Consequently, this study aims to provide some new estimates of the degree of returns to scale for EU regional manufacturing. It does so within the framework of the Verdoorn law. Unlike previous studies, issues of specification of fundamental importance to recent theoretical developments are brought to attention. Overall, the paper concludes that localised increasing returns in EU regional manufacturing are substantial.
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Date of creation: Aug 2008
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increasing returns; Verdoorn law; manufacturing; productivity growth; spatial econometrics;
Find related papers by JEL classification:
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
- R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-10-07 (All new papers)
- NEP-EEC-2008-10-07 (European Economics)
- NEP-EFF-2008-10-07 (Efficiency & Productivity)
- NEP-GEO-2008-10-07 (Economic Geography)
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