In the last fifteen years, income differences among European Member States have been strongly narrowing while the process has been matched with a widening of the inter-regional variance within single countries. Traditionally, regional economic disparities in Europe have been ascribed to...

By adopting a semiparametric approach, the 'traditional' regional knowledge production function is developed in three complementary directions. First, the model is augmented with region-specic time trends in order to account for endogeneity due to selection on unobservables. Second, the...