Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/73543
Authors: 
Pfaffermayr, Michael
Year of Publication: 
2009
Series/Report no.: 
Working Papers in Economics and Statistics 2009-07
Abstract: 
This paper suggests that one should account for the endogeneity of important explanatory variables and the persistence of technology shocks when analyzing spatial convergence among regions.Specifically, it is argued that a systems approach is called for that includes the average growth rate and the initial income level as the endogenous variables. For 212 European regions the estimation results reveal a substantial correlation between the disturbances of the equation explaining initial income per capita and that of its subsequent average growth rate. Moreover, the estimated speed of convergence is found substantially higher in a systems framework. This holds true for both spatial conditional and unconditional convergence.
Subjects: 
Spatial beta-convergence
Spatial Solow model
Spatial systems maximum likelihood estimation
Europeanregions
JEL: 
R11
C31
O47
Document Type: 
Working Paper

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