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New Directions in Economic Geography

Edited by Bernard Fingleton

This important book explores original and alternative directions for economic geography following the revolution precipitated by the advent of so-called ‘new economic geography’ (NEG). Whilst, to some extent, the volume could be regarded as part of the inevitable creative destruction of NEG theory, it does promote the continuing role of theoretical and empirical contributions within spatial economic analysis, in which the rationale of scientific analysis and economic logic maintain a central place. With contributions from leading experts in the field, the book presents a comprehensive analysis of the extent to which NEG theory is supported in the real world. By exploring whether NEG theory can be effectively applied to provide practical insights, the authors highlight novel approaches, emerging trends, and promising new lines of enquiry in the wake of advances made by NEG.
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Chapter 8: A Non-parametric Analysis of Productivity, Efficiency and Technical Change in EU Regional Manufacturing, 1986–2002

Mark Roberts, John S.L. McCombie and Alvaro Angeriz


8. A non-parametric analysis of productivity, efficiency and technical change in EU regional manufacturing, 1986–2002 Mark Roberts, John S.L. McCombie and Alvaro Angeriz 8.1 INTRODUCTION Studies of cross-regional productivity differences and their evolution over time have, with the twin emergence of better data sets and a rising tide of interest amongst economists in spatial issues, become increasingly popular over the last decade and a half.1 This is especially true for the European Union, where further impetus has, of course, been provided by the advent of Economic and Monetary Union (EMU). Despite this, however, relatively little, if anything, is known about whether cross-regional differences in productivity growth in the EU are attributable to spatial differences in the efficiency with which factors are employed or spatial disparities in the rate of technical change. Indeed, the theoretical framework typically used as the backdrop for empirical research in this area assumes that all regions are technically efficient and that technology is a pure public good. That is to say, the framework typically used is an ‘old’ neoclassical growth framework that implicitly assumes that all regions are not only operating on their production functions, but that they share the same production function. This being the case, spatial differences in productivity are purely attributable to spatial differences in labour productivity emanating from differences in the capital intensity of production. Likewise, spatial differences in rates of productivity growth take the form of spatial differences in...

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