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Productivity polarization across regions in Europe

  • Roberto Basile

The regional distribution of labor productivity in Western Europe is characterised by a Core-Periphery spatial pattern: high (low) productivity regions are in a proximate relationship with other high (low) productivity regions. Over the last twenty years, intra-distribution dynamics has generated long-run multiple equilibria with the formation of two clubs of convergence. The observed dynamics can be only marginally explained by nonlinear effects in the accumulation of physical capital. In contrast, the joint effect of spatial dependence and nonlinearities in growth behavior plays a key role in determining multiple equilibria and reinforcing polarization of labor productivity.

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Paper provided by Università di Perugia, Dipartimento Economia in its series Quaderni del Dipartimento di Economia, Finanza e Statistica with number 31/2007.

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Length: 49 pages
Date of creation: 10 Apr 2007
Date of revision:
Handle: RePEc:pia:wpaper:31/2007
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