Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/73886
Authors: 
Wagner, Martin
Zeileis, Achim
Year of Publication: 
2012
Series/Report no.: 
Working Papers in Economics and Statistics 2012-20
Abstract: 
This paper uses model-based recursive partitioning to study economic growth in the 255 European Union NUTS2 regions over the period 1995-2005. The starting point of the analysis is a human-capital augmented Solow-type growth equation similar in spirit to Mankiw, Romer, and Weil (1992). Initial GDP and the share of highly educated in the working age population are found to be important for explaining economic growth, whereas the investment share in physical capital is only significant for coastal regions in the PIIGS countries. Recursive partitioning leads to a regression tree with four terminal nodes with partitioning according to (i) capital regions, (ii) non-capital regions in or outside the so-called PIIGS countries and (iii) inside the respective PIIGS regions furthermore between coastal and non-coastal regions.
Subjects: 
convergence
growth regressions
recursive partitioning
regional data
JEL: 
C31
C51
O18
O47
Document Type: 
Working Paper

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