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Productivity convergence across industries and regions in Norway and Sweden


  • Östbye, Stein

    () (Department of Economics, University of Tromso, N-9037 Tromso, Norway)

  • Westerlund, Olle

    () (Department of Economics, Umeå University)


Several authors have asked why the differences in output per worker between countries are so large and hypothesized that differences in social infrastructure provide an answer. However, differences in output per worker also vary considerably when comparing spatial units at lower levels of resolution, without substantial variation in the social infrastructure. The purpose of this paper is to discuss possible reasons for regional differences based on data for the Scandinavian Peninsula at a spatial resolution almost equivalent to the European NUTS3. Since Norway and Sweden are considered to be particularly egalitarian and homogeneous societies, differences in broad measures of social infrastructure can hardly be invoked as substantially important determinants of productive performance. Instead, we investigate the role played by industrial structure. We find strong productivity convergence between Norwegian regions and weak divergence between Swedish ones. For Norway, there is convergence in primary production, manufacturing and services. For Sweden, there is divergence, except in the primary sector. The effect of the industry structure on the spatial distribution of productivity appears to be small in magnitude, but is qualitatively important at least for one time period. The data cover 5-year intervals from 1980 to 2000 for Norway and from 1985 to 2000 for Sweden.

Suggested Citation

  • Östbye, Stein & Westerlund, Olle, 2004. "Productivity convergence across industries and regions in Norway and Sweden," Umeå Economic Studies 632, Umeå University, Department of Economics.
  • Handle: RePEc:hhs:umnees:0632

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    References listed on IDEAS

    1. Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 407-443.
    2. Stein Ostbye & Olle Westerlund, 2003. "Comparing home-grown fruits: productivity convergence across industries and regions," ERSA conference papers ersa03p483, European Regional Science Association.
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    Cited by:

    1. Evert Meijers & Krister Sandberg, 2006. "Polycentric Development to Combat Regional Disparities? the Relation Between Polycentricity and Regional Disparities in European Countries," ERSA conference papers ersa06p287, European Regional Science Association.

    More about this item


    growth; productivity convergence; comparative study; European regions;

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • 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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