Presentation of paper:

Productivity growth in the Old and New Europe: the role of agglomeration externalities

Speaker

Raffaele Paci

Università di Cagliari, CRENoS

Abstract

Raffaele Paci, Emanuela Marrocu and Stefano Usai (University of Cagliari, CRENoS)

The recent history of Europe is characterized by a dual picture showing the old and new member states in sharp contrast with respect to their industrial specialisation and economic performance. We analyse the intertwined performance of regions and industries in Europe by investigating the effects of local agglomeration externalities (mainly specialisation and diversity externalities) on total factor productivity dynamics. More specifically, we analyse whether the agglomeration externalities effects vary according to the development stage (Old vs New Europe), the specialisation pattern (low-tech manufactures vs knowledge intensive sectors) and the settlement typology (urban vs rural areas). We also assess  the potential influence of intangible assets such as human and technological capital. The econometric analysis is carried out over the period 1996-2007 for 13 industries located in 276 regions of 29 European countries and it makes use of spatial econometric techniques to take into account the possibility of cross-border externalities.

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