R&D, Spillovers, Innovation Systems and the Genesis of Regional Growth in Europe. Bruges European Economic Research (BEER) Papers 5/October 2006

Research on the impact of innovation on regional economic performance in Europe has fundamentally followed three approaches: a) the analysis of the link between investment in R&D, patents, and economic growth; b) the study of the existence and efficiency of regional innovation systems; and c) the examination of geographical diffusion of regional knowledge spillovers. These complementary approaches have, however, rarely been combined. Important operational and methodological barriers have thwarted any potential cross-fertilization. In this paper, we try to fill this gap in the literature by combining in one model R&D, spillovers, and innovation systems approaches. A multiple regression analysis is conducted for all regions of the EU-25, including measures of R&D investment, proxies for regional innovation systems, and knowledge and socio-economic spillovers. This approach allows us to discriminate between the influence of internal factors and external knowledge and institutional flows on regional economic growth. The empirical results highlight how the interaction between local and external research with local and external socioeconomic and institutional conditions determines the potential of every region in order to maximise its innovation capacity. They also indicate the importance of proximity for the transmission of economically productive knowledge, as spillovers show strong distance decay effects. In the EU-25 context, only the innovative efforts pursued within a 180 minute travel radius have a positive and significant impact on regional growth performance.

Do Clusters Generate Greater Innovation and Growth? An Analysis of European Regions. Bruges European Economic Research (BEER) Papers 21/October 2011

The analysis of clusters has attracted considerable interest over the last few decades. The articulation of clusters into complex networks and systems of innovation -- generally known as regional innovation systems -- has, in particular, been associated with the delivery of greater innovation and growth. However, despite the growing economic and policy relevance of clusters, little systematic research has been conducted into their association with other factors promoting innovation and economic growth. This article addresses this issue by looking at the relationship between innovation and economic growth in 152 regions of Europe during the period between 1995 and 2006. Using an econometric model with a static and a dynamic dimension, the results of the analysis highlight that: a) regional growth through innovation in Europe is fundamentally connected to the presence of an adequate socioeconomic environment and, in particular, to the existence of a well-trained and educated pool of workers; b) the presence of clusters matters for regional growth, but only in combination with a good ‘social filter’, and this association wanes in time; c) more traditional R&D variables have a weak initial connection to economic development, but this connection increases over time and, is, once again, contingent on the existence of adequate socioeconomic conditions.

The growth effects of EU cohesion policy: a meta-analysis. Bruegel Working Paper 2012/14, October 2012

We run a standard income convergence analysis for the last decade and confirm an already established finding in the growth economics literature. EU countries are converging. Regions in Europe are also converging. But, within countries, regional disparities are on the rise. At the same time, there is probably no reason for EU Cohesion Policy to be concerned with what happens inside countries. Ultimately, our data shows that national governments redistribute well across regions, whether they are fiscally centralised or decentralised. It is difficult to establish if Structural and Cohesion Funds play any role in recent growth convergence patterns in Europe. Generally, macroeconomic simulations produce better results than empirical tests. It is thus possible that Structural Funds do not fully realise their potential either because they are not efficiently allocated or are badly managed or are used for the wrong investments, or a combination of all three. The approach to assess the effectiveness of EU funds should be consistent with the rationale behind the post-1988 EU Cohesion Policy. Standard income convergence analysis is certainly not sufficient and should be accompanied by an assessment of the changes in the efficiency of the capital stock in the recipient countries or regions as well as by a more qualitative assessment. EU funds for competitiveness and employment should be allocated by looking at each region’s capital efficiency to maximise growth generating effects or on a pure competitive.

Kazakhstan: the regional success story; Tajikistan: a trial period; Uzbekistan: the major source of instability in Central Asia? OSW Study 15/2004

Kazakhstan: Kazakhstan can boast economic development like no other country in Central Asia. In contrast to other countries of the region, which have rich natural resources, Kazakhstan has managed to use its economic potential in a way that yields concrete benefits now and, at the same time, creates prospects for further sustainable economic growth. Tajikistan: Tajikistan in its present state has been built on the civil war experiences and provisions of the peace accords signed in 1997. These have had a great impact on the present form of the state, its political scene and power mechanisms. President Emomali Rakhmonov is the central figure in the state. The political system, which he has cocreated, is based on - unique in this region - political pluralism (the existence of the Islamic party), decentralisation (far-going independence of the regions and relatively limited potential of the central structures) and compromise as the basic way of resolving conflicts. Such a system has so far guaranteed stabilisation and normalisation of the country. Uzbekistan: With its geographic location, potential, ambitions and political priorities, Uzbekistan could play a leading role in Central Asia. The international community has perceived the country as the pillar of stability in the region. This perception was further reinforced after 11th September 2001 and was certainly among the factors that inspired the United States to start closer political and military cooperation with Tashkent. The administration in Washington had expected that closer contacts might galvanise political, economic and social change in Uzbekistan, thus reinforcing positive trends in other countries of the region as well. But the relations between Washington and Tashkent are in crisis (which the United States will certainly try to overcome), and we have seen rapprochement between Uzbekistan and Russia and China.

Measuring the intermittent synchronicity of macroeconomic growth in Europe. ACES Cases No. 2010.1

Synchronization of growth rates are an important feature of international business cycles, particularly in relation to regional integration projects such as the single currency in Europe. Synchronization of growth rates clearly enhances the effectiveness of European Central Bank monetary policy, ensuring that policy changes are attuned to the dynamics of growth and business cycles in the majority of member states. In this paper a dissimilarity metric is constructed by measuring the topological differences between the GDP growth patterns in recurrence plots for individual countries. The results show that synchronization of growth rates were higher among the Euro area member states during the second half of the 1980s and from 1997 to roughly 2002. Apart from these two time periods, Euro area member states do not appear to be more synchronized than a group of major international countries, signifying that globalization was the major cause of international business cycle synchronization.