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Total factor productivity effects of interregional knowledge spillovers in manufacturing industries across Europe


  • Thomas Scherngell

    () (Institute for Economic Geography & GIScience Vienna University of Economics)

  • Manfred M. Fischer

    (Vienna University of Economics and Business Administration)

  • Martin Reismann

    (Vienna University of Economics and Business Administration)


The objective of this study is to identify knowledge spillovers that spread across regions in Europe and vary in magnitude for different industries. The study uses a panel of 203 NUTS-2 regions covering the 15 pre-2004 EU-member-states to estimate the impact over the period 1998-2003, and distinguish between five major industries. The study implements a fixed effects panel data regression model with spatial autocorrelation to estimate effects using patent applications as a measure of R&D output to capture the contribution of R&D (direct and spilled-over) to regional productivity at the industry level. The results suggest that interregional knowledge spillovers and their productivity effects are to a substantial degree geographically localised and this finding is consistent with the localisation hypothesis of knowledge spillovers. There is a substantial amount of heterogeneity across industries with evidence that two industries (electronics, and chemical industries) produce interregional knowledge spillovers that have positive and highly significant productivity effects. The study, moreover, confirms the importance of spatial autoregressive disturbance in the fixed effects model for measuring the TFP impact of interregional knowledge spillovers at the industry level.

Suggested Citation

  • Thomas Scherngell & Manfred M. Fischer & Martin Reismann, 2007. "Total factor productivity effects of interregional knowledge spillovers in manufacturing industries across Europe," Romanian Journal of Regional Science, Romanian Regional Science Association, vol. 1(1), pages 1-16, December.
  • Handle: RePEc:rrs:journl:v:1:y:2007:i:1:p:1-16

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    References listed on IDEAS

    1. Tocco, Barbara & Davidova, Sophia & Bailey, Alastair, 2013. "The Impact of CAP Payments on the Exodus of Labour from Agriculture in Selected EU Member States," Working Papers 160742, Factor Markets, Centre for European Policy Studies.
    2. Olper, Alessandro & Raimondi, Valentina & Cavicchioli, Daniele & Vigani, Mauro, 2012. "Does the Common Agricultural Policy Reduce Farm Labour Migration? Panel data analysis across EU regions," Working Papers 128790, Factor Markets, Centre for European Policy Studies.
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    Cited by:

    1. Emanuela Marrocu & Raffaele Paci & Stefano Usai, 2013. "Productivity Growth In The Old And New Europe: The Role Of Agglomeration Externalities," Journal of Regional Science, Wiley Blackwell, vol. 53(3), pages 418-442, August.
    2. Christ, Julian P., 2009. "The geography and co-location of European technology-specific co-inventorship networks," Violette Reihe: Schriftenreihe des Promotionsschwerpunkts "Globalisierung und Beschäftigung" 31/2010, University of Hohenheim, Carl von Ossietzky University Oldenburg, Evangelisches Studienwerk.
    3. Michael Barber & Thomas Scherngell, 2011. "Is the European R&D network homogeneous? spatial interaction modeling of network communities determined using graph theoretic methods," ERSA conference papers ersa11p392, European Regional Science Association.
    4. Amjad Naveed & Nisar Ahmad, 2014. "Technology Spillovers and International Borders: A Spatial Econometric Analysis," Working Papers 2, University of Southern Denmark, Centre for Border Region Studies.

    More about this item


    Total factor productivity; manufacturing industries; knowledge spillovers; patents; European regions; spatial econometrics;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes


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