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Regional Convergence in the European Union: What are the Factors of Growth?

Author

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  • Jan Pintera

    (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Opletalova 26, 110 00, Prague, Czech Republic)

Abstract

Despite years of deepening economic integration among the states and regions of the European Union, empirical research remains inconclusive about speed of convergence across regions, if not its existence. This paper provides a new look on convergence in the EU while focusing on development at regional level after the Great Recession. It uses the log t convergence test by Phillips and Sul (2007) to analyze the convergence in level of income among the European regions. Rather than supporting the convergence hypothesis, we identify five convergence clubs in which the regions converge in income growth rates. Investigating further the geographical distribution of the convergence clubs, we confirm high inequality within the member states and find large continuous area of high convergence clubs in the urbanized part of Western Europe. Furthermore, we investigated the determinants of convergence club membership using Logistic Regression. We found a low impact of any of the estimated variables on membership in the highest club but confirmed positive association of membership in the higher clubs with research and patent activities.

Suggested Citation

  • Jan Pintera, 2021. "Regional Convergence in the European Union: What are the Factors of Growth?," Working Papers IES 2021/20, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Jun 2021.
    • Handle: RePEc:fau:wpaper:wp2021_20
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    File URL: https://ies.fsv.cuni.cz/en/veda-vyzkum/working-papers/6442
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    More about this item

    Keywords

    Club Convergence; European Regions; log t test; Logistic regression;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C40 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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