European regional growth, technology gap and R&D efforts
Since the early days of European integration, one of the central goals for the European Union has been greater equality in income and productivity among member states and regions. This goal was realised for a long time since form the early 1950s onwards, differences in GDP per capita within European regions declined steadily. However, more recently, THE PROCESS OF EUROPEAN ECONOMIC CONVERGENCE HAS CONSIDERABLY SLOWED DOWN and, according to a widening group of economists, has CEASED AT THE REGIONAL LEVEL after 1980. The paper we wish to present aims to explain the different PATTERNS OF CONVERGENCE AND DIVERGENCE in terms of GDP per capita of the European regions. Is it reasonable to think that catching up will occur for all European regions? What role does the technology gap play for the catching up process? What are the mechanisms and policies to be implemented to upgrade social capability which is a major determinant of catching up? In order to answer these crucial questions we have built a MODEL OF CUMULATIVE GROWTH - a SIMULTANEOUS SYSTEM OF EQUATIONS. In this model, and according to the technology gap literature, one of the major determinants of catching up is the existence of a TECHNOLOGY GAP. The latter offers a potential for faster growth if SOCIAL CAPABILITY is sufficiently developed. In our model, social capability is measured in terms of highly and moderately qualified working population, R&D activity and physical infrastructure endowment. Industrial and service activities as well as innovative output are endogenised in the simultaneous equations framework. Our model is tested onto a sample of European regions that is considerably larger than those used by authors publishing in related fields. Whereas the latter generally use NUTS I samples (about 60 observations), our sample is essentielly based upon NUTS II regions and the NUMBER OF OBSERVATIONS TOTALS 153 REGIONS. If this extended sample constitutes clearly one of the INNOVATIONS of this paper with respect to the existing literature, another originality is the chosen approach to explain the different trajectories of convergence and divergence. Indeed, our approach permits to CLUSTER the European regions with respect to their steady state levels of GDP per capita and, more important, enables to identify for each cluster the appropriate policy measures.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- N. Gregory Mankiw & David Romer & David N. Weil, 1990.
"A Contribution to the Empirics of Economic Growth,"
NBER Working Papers
3541, National Bureau of Economic Research, Inc.
- Baumol, William J & Wolff, Edward N, 1988. "Productivity Growth, Convergence, and Welfare: Reply," American Economic Review, American Economic Association, vol. 78(5), pages 1155-1159, December.
- Jan Fagerberg, 1987.
"A technology gap approach to why growth rates differ,"
Working Papers Archives
1987002, Centre for Technology, Innovation and Culture, University of Oslo.
- Fagerberg, Jan, 1987. "A technology gap approach to why growth rates differ," Research Policy, Elsevier, vol. 16(2-4), pages 87-99, August.
- Jan Fagerberg, 1999. "The Economic Challenge for Europe: Adapting to Innovation-Based Growth," Working Papers 2, Centre for Technology, Innovation and Culture, University of Oslo.
- Jan Fagerberg & Bart Verspagen & Marjolein Caniëls, 1997. "Technology, Growth and Unemployment across European Regions," Regional Studies, Taylor & Francis Journals, vol. 31(5), pages 457-466.
- Abramovitz,Moses, 1989. "Thinking about Growth," Cambridge Books, Cambridge University Press, number 9780521333962, October.
- Jonathan Temple, 1999. "The New Growth Evidence," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 112-156, March.
- Gene M. Grossman & Elhanan Helpman, 1993.
"Endogenous Innovation in the Theory of Growth,"
NBER Working Papers
4527, National Bureau of Economic Research, Inc.
- Barro, R.J., 1989.
"Economic Growth In A Cross Section Of Countries,"
RCER Working Papers
201, University of Rochester - Center for Economic Research (RCER).
- Baldwin, Richard & Forslid, Rikard, 1997. "The Core-Periphery Model and Endogenous Growth," CEPR Discussion Papers 1749, C.E.P.R. Discussion Papers.
- Bart Verspagen, 1997. "Estimating international technology spillovers using technology flow matrices," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 133(2), pages 226-248, 06.
- Jan Fagerberg & Bart Verspagen, 1996. "Heading for Divergence? Regional Growth in Europe Reconsidered," Journal of Common Market Studies, Wiley Blackwell, vol. 34(3), pages 431-448, 09.
- Aadne Cappelen & Jan Fagerberg & Bart Verspagen, 1999. "Lack of regional convergence," Working Papers Archives 1999001, Centre for Technology, Innovation and Culture, University of Oslo.
- Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-1085, December.
- Fagerberg, Jan, 1994. "Technology and International Differences in Growth Rates," Journal of Economic Literature, American Economic Association, vol. 32(3), pages 1147-1175, September.
- Bernard Fingleton, 2000. "Convergence: International comparisons based on a simultaneous equation model with regional effects," International Review of Applied Economics, Taylor & Francis Journals, vol. 14(3), pages 285-305.
- Dosi, Giovanni, 1988. "Sources, Procedures, and Microeconomic Effects of Innovation," Journal of Economic Literature, American Economic Association, vol. 26(3), pages 1120-1171, September.
When requesting a correction, please mention this item's handle: RePEc:wiw:wiwrsa:ersa01p92. 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: (Gunther Maier)
If references are entirely missing, you can add them using this form.