Regions, technological interdependence and growth in Europe

Fischer, Manfred M. ORCID: (2009) Regions, technological interdependence and growth in Europe. The Romanian Journal of Regional Science, 3 (2). pp. 1-17. ISSN 1843-8520


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This paper presents a theoretical neoclassical growth model with two kinds of capital, and technological interdependence among regions. Technological interdependence is assumed to operate through spatial externalities caused by disembodied knowledge diffusion between technologically similar regions. The transition from theory to econometrics yields a reduced-form empirical model that in the spatial econometrics literature is known as spatial Durbin model. Technological dependence between regions is formulated by a connectivity matrix that measures closeness of regions in a technological space spanned by 120 distinct technological fields. We use a system of 158 regions across 14 European countries over the period from 1995 to 2004 to empirically test the model. The paper illustrates the importance of an impact-based model interpretation, in terms of the LeSage and Pace (2009) approach, to correctly quantify the magnitude of spillover effects that avoid incorrect inferences about the presence or absence of significant capital externalities among technologically similar regions.

Item Type: Article
Keywords: Economic growth / augmented Mankiw-Romer-Weil model / disembodied knowledge Diffusion / technological similarity between regions / spatial econometrics / European regions
Classification Codes: JEL C31, O18, O47, R11
Divisions: Departments > Sozioökonomie > Wirtschaftsgeographie und Geoinformatik
Forschungsinstitute > Supply Chain Management
Depositing User: Gertraud Novotny
Date Deposited: 17 Aug 2016 13:10
Last Modified: 04 Nov 2019 13:59
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