The paper asks whether subsidies aiming to redistribute economic activity across regions can be justified with the welfare argument. Moreover, different tax systems are compared with respect to the size of the subsidy needed for achieving a certain spatial distribution of economic activity, and...

This paper examines the extent to which sectoral diversification can act as an insurance mechanism against fluctuations in regional gross value added growth rates. I apply portfolio theory to the growth-instability properties of German districts. Furthermore, I define a comprehensive...

Applied econometrics has recently emphasized the identification of causal parameters for policy analysis. This revolution has yet to fully propagate to the field of regional science. We examine the scope for application of the matching approach – part of the modern applied econometrics toolkit...

The paper presents a multiregional endogenous growth model designed for calibration with real world data and for numerical policy evaluation. It integrates four strands of research: (1) the Ramsey model of consumer behaviour, (2) Tobin's q-theory of investment, (3) Romer's theory of endogenous...

We use a dynamic model to study the effects of technology and learning on the long run economic growth rates of a leading and a lagging region. New technologies are developed in the leading region but technological improvements in the lagging region are the result of learning from the leading...

Regional economic development is driven by the accumulation of production factors. More traditional factors like labour and physical capital are accumulated under the law of diminishing returns. This, in turn, allows less developed regions to better perform. Recent branches of theoretical and...

Rural areas still play a major role within the EU, as Europe is still a fairly rural continent. Moreover, EU rural areas are going through greater challenges and major transformations. After the Eastern enlargements of the EU (in 2004 and 2007), they are getting more and more heterogeneous, in...

In this paper, we introduce a distinction between interregional and intraregional transportation costs, in a footloose capital model. This allows assessing more precisely the effects of different types of transport policies, on the spatial distribution of activities. From a normative point of...

Applied econometrics has recently emphasized the identification of causal parameters for policy analysis. This revolution has yet to fully propagate to the field of regional science. We examine the scope for application of the matching approach – part of the modern applied econometrics toolkit...

Shift-share analysis is a decomposition technique widely used in regional studies to quantify an industry-mix effect and a competitive effect on the growth of regional employment (or any other relevant variable) relative to the national average. This technique has always been subject to...