Handbook of Regional Growth and Development Theories
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Handbook of Regional Growth and Development Theories

Revised and Extended Second Edition

Edited by Roberta Capello and Peter Nijkamp

Regional economics – an established discipline for several decades – has undergone a period of rapid change in the last ten years resulting in the emergence of several new perspectives. At the same time the methodology of regional economics has also experienced some surprising developments. This fully revised and updated Handbook brings together contributions looking at new pathways in regional economics, written by many well-known international scholars. The aim is to present the most cutting-edge theories explaining regional growth and local development. The authors highlight the recent advances in theories, the normative potentialities of these theories and the cross-fertilization of ideas between regional and mainstream economists. It will be an essential source of reference and information for both scholars and students in the field.
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Chapter 22: Heterogeneous reaction versus interaction in spatial econometric regional growth and convergence models

Julie Le Gallo and Cem Ertur

Abstract

In this chapter, we present the main econometric specifications capturing spatial heterogeneity, or models of absolute locations, and examine how these specifications can be extended to further allow for spatial autocorrelation models of heterogeneous reaction by emphasizing the complex links between spatial heterogeneity and spatial autocorrelation. We detail some of these issues in the growth and convergence context in this chapter by first presenting the specifications allowing for discrete heterogeneity, that is, when different parameters are estimated following spatial regimes including a focus on recent papers dealing with the endogenous detection of convergence in the presence of spatial autocorrelation. Then we present continuous spatial heterogeneity models: geographically weighted regressions and models allowing for both continuous spatial heterogeneity and spatial autocorrelation. We conclude with some research directions.

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