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What said the economic theory about Portugal. Another approach

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  • Martinho, Vítor João Pereira Domingues

Abstract

With this work we try to analyse the agglomeration process in the Portuguese regions, using the New Economic Geography models. This work aims to test, also, the Verdoorn Law, with the alternative specifications of (1)Kaldor (1966), for the 28 NUTS III Portuguese in the period 1995 to 1999. It is intended to test the alternative interpretation of (2)Rowthorn (1975). With this study we want, also, to test the Verdoorn´s Law at a regional and a sectoral levels (NUTs II) for the period 1995-1999. The importance of some additional variables in the original specification of Verdoorn´s Law is yet tested, such as, trade flows, capital accumulation and labour concentration. This study analyses, also, through cross-section estimation methods, the influence of spatial effects in productivity in the NUTs III economic sectors of mainland Portugal from 1995 to 1999, considering the Verdoorn relationship. The aim of this paper is, yet, to present a contribution, with panel data, to the analysis of absolute convergence and conditional of the sectoral productivity at regional level (from 1995 to 1999). The structural variables used in the analysis of conditional convergence is the ratio of capital/output, the flow of goods/output and location ratio.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 33022.

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Date of creation: 2011
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Handle: RePEc:pra:mprapa:33022

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Keywords: new economic geography; Verdoorn law; convergence; cross-section and panel data; Portuguese regions;

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  1. Anthony J. Venables, 1993. "Equilibrium Locations of Vertically Linked Industries," CEP Discussion Papers dp0137, Centre for Economic Performance, LSE.
  2. Xavier Sala-i-Martin, 1994. "Regional cohesion: Evidence and theories of regional growth and convergence," Economics Working Papers 104, Department of Economics and Business, Universitat Pompeu Fabra.
  3. Barro, Robert J & Sala-i-Martin, Xavier, 1992. "Convergence," Journal of Political Economy, University of Chicago Press, vol. 100(2), pages 223-51, April.
  4. Paul Krugman, 1998. "Space: The Final Frontier," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 161-174, Spring.
  5. Martinho, Vítor João Pereira Domingues, 2012. "What the Keynesian theory said about Portugal?," EconStor Preprints 59007, ZBW - German National Library of Economics.
  6. Raymond J.G.M. Florax & Hendrik Folmer & Sergio J. Rey, 2002. "Specification Searches in Spatial Econometrics: The Relevance of Hendry's Methodology," Urban/Regional 0202001, EconWPA.
  7. Fujita, Masahisa, 1988. "A monopolistic competition model of spatial agglomeration : Differentiated product approach," Regional Science and Urban Economics, Elsevier, vol. 18(1), pages 87-124, February.
  8. Martinho, Vítor João Pereira Domingues, 2011. "The importance of increasing returns to scale in the process of agglomeration in Portugal: A non linear empirical analysis," MPRA Paper 32204, University Library of Munich, Germany.
  9. Robert J. Barro & Xavier Sala-i-Martin, 1991. "Convergence across States and Regions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(1), pages 107-182.
  10. Fujita, Masahisa & Mori, Tomoya, 1996. "The role of ports in the making of major cities: Self-agglomeration and hub-effect," Journal of Development Economics, Elsevier, vol. 49(1), pages 93-120, April.
  11. Martinho, Vítor João Pereira Domingues, 2011. "What said the neoclassical and endogenous growth theories about Portugal?," MPRA Paper 32631, University Library of Munich, Germany.
  12. Krugman, Paul, 1994. "Complex Landscapes in Economic Geography," American Economic Review, American Economic Association, vol. 84(2), pages 412-16, May.
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