The Contribution of Regions to Aggregate Growth in the OECD
This paper investigates the contribution of regions to aggregate growth in the OECD. We find a great degree of heterogeneity in the performance of OECD TL3 regions and among the OECD regional typology (urban, intermediate and rural). While the distribution in GDP and GDP per capita growth rates follows an approximately normal distribution, the regional contributions to aggregate growth follow a power law, with a coefficient around 1.2 (in absolute terms). This implies that Few-Large (FL) regions contribute disproportionately to aggregate growth whereas Many-Small (MS) individual regions contribute only marginally. Nevertheless, because the number of these smaller regions is very large and the decay of their contribution to growth is slow (generating a fat tail distribution), their cumulated contribution is actually around 2/3 of aggregate growth. For the period 1995-2007, only 2.4% of OECD TL3 regions contribute to 27% of OECD GDP growth, but the remaining 97.6% corresponds to 73%. We also found that the distribution of growth rates by size follows a non-monotonic pattern, with the largest concentration of above average regional growth rates being concentrated for middle-sized regions. This heterogeneity suggests that the possibilities for growth seem to exist in many different types of regions.
|Date of creation:||24 Dec 2013|
|Contact details of provider:|| Postal: 2 rue Andre Pascal, 75775 Paris Cedex 16|
Phone: 33-(0)-1-45 24 82 00
Web page: http://www.oecd.org
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:oec:govaab:2013/28-en. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.