Regional convergence in Finnish provinces and subregions, 1960-94
This paper analyses regional productivity convergence in Finland using two different data sets. Firstly, absolute and conditional convergence was estimated in the 12 Finnish provinces during 1960-94. Convergence was found to be strong in 1960-80, but after 1980 regional disparities started to grow again. Secondly, similar study was made for the 88 small-scale subregions in 1988-94. In addition, the subregions' relative growth performance and cross-sectional convergence dynamics were evaluated using Markov chain transition matrices. No clear evidence of (beta- or sigma-) convergence was found here, but the dynamic analysis revealed an evolving regional distribution of productivity and noticeable potential for convergence. Thus the regional classification and the method used can markedly affect the results obtained in a convergence study.
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