Spurious regression analysis in panel data when the time series are cross-section dependent is analyzed in the paper. We show that consistent estimation of the long-run average parameter is possible once we control for cross-section dependence using cross-section averages in the spirit of the...

Recent contributions to the literature on public choice have examined the effects of regional fiscal balances and unsuitable decentralization mechanisms on the capability of regional governments to make expenditure decisions. We focus on Spanish regional case. Our results suggest that, given the...

Growth literature has considered the existence of groups of economies which have been termed convergence clubs. Literature confirms their existence for European regional case. This paper has focused on how conditioning factors are influencing European regional GDPpc distribution. The estimation...

The power of standard panel cointegration statistics may be affected by misspecification errors if proper account is not taken of the presence of structural breaks in the data. We propose modifications to allow for one structural break when testing the null hypothesis of no cointegration that...