Inequality and growth in European regions: Towards a place-based approach.

Does inequality matter for growth? This paper addresses this question by evaluating the impact that intra-regional income distribution has on regional growth. By using a spatially augmented Solow growth model, we investigate the convergence process among EU regions between 1991 and 2004 and extend the traditional specifications to account for the impact of disparities on growth, as well the effects of interaction among regions. We observe no evidence of an overall significant relationship between initial inequality and growth. However, when we distinguish between Non Objective 1 and Objective 1 regions, we find that inequality positively impact subsequent growth only in the latter. This result supports recent discussions on the need of a more placed-based regional development policy at the European level.

DE DOMINICIS Laura; 

2014-10-02

ROUTLEDGE JOURNALS

JRC78003

1742-1772,   

http://www.tandfonline.com/doi/abs/10.1080/17421772.2014.891157#.VC0u3RBfa3E,    https://publications.jrc.ec.europa.eu/repository/handle/JRC78003,   

10.1080/17421772.2014.891157,