Eckey, Hans-Friedrich Döring, Thomas Türck, Matthias
Year of Publication:
Volkswirtschaftliche Diskussionsbeiträge No. 86
Convergence of EU regions is an often examined research question. However, there are no studies available which include in their analysis the New Member States from the former Eastern Bloc. We estimate several models of absolute convergence and of conditional convergence taking into account the different initial conditions of the regions from each country. First, we calculate convergence models with equal convergence rates of every region (stationary approaches). We prove a convergence process with nearly all models between 1995-2003. Only the spatial filtering approach in combination with the inclusion of country specific dummy variables shows a significant divergent development. Second, we calculate a geographically weighted regression (GWR) approach, which uses instationary regression coefficients. This model gives evidence for a convergence of most regions. However, some regions seem to move away from their steady state.