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Regional Income Inequality and Convergence Processes in the EU-25

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  • Tiiu Paas

    ()

  • Friso Schlitte

    ()

Abstract

The paper investigates income inequality and convergence among the EU-25 countries and their regions at NUTS 3 (Nomenclature of Territorial Units for Statistics) level during the period 1995-2002. We measure the level of income inequality and its decomposition distinguishing the between and within country inequality as the components of the overall income inequality of EU-25, EU-15 and the new member states (NMS) of the EU recent enlargement in May 2004. In order to assess the inequality in living standards GDP in purchasing power standards (PPS) is used. In the empirical analysis of the convergence processes we consider the effects of interactions among neighbouring regions implementing spatial econometrics techniques. The estimation results are sensitive to the control for national effects. While the EU-25 and the EU-15 experienced a slow but significant process of absolute convergence there is no evidence found for regional convergence when national effects are considered. In the NMS the process of conditional convergence across regions even turns out to be significantly negative. This indicates that there were some divergence tendencies in the NMS during the period of 1995 – 2002.

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Bibliographic Info

Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa06p229.

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Date of creation: Aug 2006
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Handle: RePEc:wiw:wiwrsa:ersa06p229

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References

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Citations

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Cited by:
  1. Niebuhr, Annekatrin & Schlitte, Friso, 2008. "EU enlargement and convergence: Does market access matter?," HWWI Research Papers 1-16, Hamburg Institute of International Economics (HWWI).
  2. Schwengler, Barbara, 2013. "Einfluss der europäischen Regionalpolitik auf die deutsche Regionalförderung," IAB Discussion Paper 201318, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  3. Justyna Supińska, 2013. "Does human factor matter for economic growth? Determinants of economic growth process in CEE countries in light of spatial theory," Bank i Kredyt, National Bank of Poland, Economic Institute, vol. 44(5), pages 505-532.
  4. Johanna Vogel, 2012. "Agglomeration and Growth: Evidence from the Regions of Central and Eastern Europe," ERSA conference papers ersa12p1089, European Regional Science Association.
  5. Davor Mikulic & Ivan Kovac, 2012. "The Role Of International Trade In Convergence Process," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 8(4), pages 7-26.
  6. George Petrakos & Panagiotis Artelaris, 2009. "European Regional Convergence Revisited: A Weighted Least Squares Approach," Growth and Change, Gatton College of Business and Economics, University of Kentucky, vol. 40(2), pages 314-331.
  7. Tyrowicz, Joanna & Wójcik, Piotr, 2009. "Active Labour Market Policies and Unemployment Convergence in Transition," MPRA Paper 15201, University Library of Munich, Germany.
  8. Eckey, Hans-Friedrich & Türck, Matthias, 2007. "Convergence of EU-Regions. A Literature Report," Investigaciones Regionales, Asociación Española de Ciencia Regional, issue 10, pages 5-32.
  9. Christ, Julian P., 2010. "Geographic concentration and spatial inequality: Two decades of EPO patenting at the level of European micro regions," Violette Reihe Arbeitspapiere 32/2010, Promotionsschwerpunkt "Globalisierung und Beschaeftigung".
  10. Boll, Christina, 2010. "Mind the gap!: The amount of German mothers' care bill and its game theoretical issues," HWWI Research Papers 1-29, Hamburg Institute of International Economics (HWWI).
  11. Egle Tafenau & Tiiu Paas, 2011. "Regional inequality and economic growth: interactions of the relationship with the level of economic development and speed of growth," ERSA conference papers ersa10p938, European Regional Science Association.
  12. Augusto Cusinato & Fabiano Compagnucci, 2011. "Industrial Districts and the City: Relationships in the Knowledge Age. Evidence from the Italian Case," ERSA conference papers ersa11p237, European Regional Science Association.
  13. Tiiu Paas, 2012. "Regional Disparities And Innovations In Europe," ERSA conference papers ersa12p80, European Regional Science Association.
  14. Juliana Dahl, 2013. "Innovation and Growth in Regions with Specific Geographical Features," Kiel Advanced Studies Working Papers 463, Kiel Institute for the World Economy.

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