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Total factor productivity, intangible assets and spatial dependence in the European regions

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  • B. Dettori

    ()

  • E. Marrocu

    ()

  • R. Paci

    ()

Abstract

In the last decade there has been an upsurge of studies on international comparisons of Total Factor Productivity (TFP). The empirical evidence suggests that countries and regions differ not only in traditional factor endowments (labour and physical capital) but mainly in productivity and technology. Therefore, a crucial issue is the analysis of the determinants of such differences in the efficiency levels across economies. In this paper we try to assess these issues by pursuing a twofold aim. First, we derive a regression based measure of regional TFP, which has the nice advantage of not imposing a priori restrictions on the inputs elasticities; this is done by estimating a spatial Cobb-Douglas production function relationship for 199 European regions over the period 1985-2006. Secondly, we investigate the determinants of the TFP levels by analyzing the role played by intangible factors - human capital, social capital and technological capital. The estimations are carried out by applying the spatial 2SLS method and the SHAC estimator to account for both heteroskedasticity and spatial autocorrelation. It turns out that a large part of TFP differences across the European regions are explained by the disparities in the endowments of these intangible assets. This outcome indicates the importance of policy strategies which aim at increasing the level of knowledge and social capital as stressed by the Lisbon agenda.

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Bibliographic Info

Paper provided by Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia in its series Working Paper CRENoS with number 200823.

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Date of creation: 2008
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Handle: RePEc:cns:cnscwp:200823

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Keywords: total factor productivity; human capital; social capital; technology; europe;

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References

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Citations

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Cited by:
  1. A. Peyrache & Andrea Filippetti, 2012. "Labour productivity and technology gap in European regions: A non-parametric approach," CEPA Working Papers Series WP022012, School of Economics, University of Queensland, Australia.
  2. Claudia Ghisetti & Francesco Quatraro, 2014. "Is green knowledge improving environmental productivity? Sectoral Evidence from Italian Regions," SEEDS Working Papers 1014, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised May 2014.
  3. Marta Foddi & Raffaele Paci & Alessandra Colombelli, 2011. "The knowledge regions in the enlarged Europe," ERSA conference papers ersa11p1140, European Regional Science Association.
  4. Emanuela Marrocu & Raffaele Paci, 2011. "Education or just Creativity: what matters most for economic performance?," ERSA conference papers ersa11p199, European Regional Science Association.
  5. E. Marrocu & R. Paci, 2012. "Regional development and creativity," Working Paper CRENoS 201202, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  6. E. Marrocu & R. Paci & S. Usai, 2010. "Productivity growth in the Old and New Europe: the role of agglomeration externalities," Working Paper CRENoS 201024, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  7. d'Agostino, Giorgio & Scarlato, Margherita, 2012. "Inclusive Institutions, Innovation and Economic Growth: Estimates for European Countries," MPRA Paper 43098, University Library of Munich, Germany.
  8. Raffaele Paci & Emanuela Marrocu, 2013. "Knowledge Assets and Regional Performance," Growth and Change, Gatton College of Business and Economics, University of Kentucky, vol. 44(2), pages 228-257, 06.
  9. Raffaele Paci & Emanuela Marrocu, 2013. "Tourism and regional growth in Europe," ERSA conference papers ersa13p40, European Regional Science Association.
  10. Emanuela Marrocu & Raffaele Paci & Marco Pontis, 2012. "Intangible capital and firms' productivity," Industrial and Corporate Change, Oxford University Press, vol. 21(2), pages 377-402, April.
  11. Emanuela Marrocu & Raffaele Paci & Marco Pontis, 2011. "Intangible capital and firms productivity (refereed paper)," ERSA conference papers ersa10p496, European Regional Science Association.
  12. Adriana Di Liberto & Stefano Usai, 2011. "TFP convergence across European regions," ERSA conference papers ersa10p409, European Regional Science Association.
  13. Attila Varga & Péter Járosi & Tamás Sebestyén, 2011. "Modeling the growth effects of regional knowledge production: The GMR-Europe model and its applications for EU Framework Program policy impact simulations," ERSA conference papers ersa11p1426, European Regional Science Association.

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