Using a spatial systems estimator to incorporate spatial interactions and endogeneity of income levels and migration, this paper finds a positive effect of migration on cohesion within the European Union on the NUTS 2 level. As migration can generally be observed from low to high income regions,...

There are two main options for companies to serve foreign markets; exports and foreign direct investment (FDI). Based on the Helpman, Melitz and Yeaple (2004) model for two host countries this paper derives a clear theoretical prediction for the decision between both strategies. A bivariate...

Empirical work on regional growth under spatial spillovers uses two workhorse models: the spatial Solow model and Verdoorn's model. This paper contrasts these two views on regional growth processes and demonstrates that in a spatial setting the speed of convergence is heterogenous in both...