The aim of this paper is to empirically identify convergence clubs in per capita incomes of European regions and to investigate whether initial conditions - as suggested by the club convergence hypothesis - are responsible for club formation. To tackle this issue, we propose a two-step procedure...

Recent empirical studies on regional economic growth have extended regressions on convergence to account for externalities and spatial dependencies. Most of these studies, however, set the focus on whether regional output levels display convergence trends and consequently tend to ignore...