José Villaverde

Regional disparities in the EU: mobility and polarization

The aim of this paper is to analyse some relevant aspects of regional disparities in the EU. The paper departs from standard analysis of convergence by tracking the evolution of the entire distribution, both by using nonparametric techniques and spatial econometric techniques. The main results confirm that: (a) regional disparities across the EU are large and persistent; (b) the ranking among the European regions is very stable; (c) there is a noticeable regional income polarization in Europe.

Globalisation, Growth and Convergence

This paper, devoted to the study of globalisation, analyses two distinct but closely related issues: First, it aims at evaluating disparities in the degree of globalisation observed in a sample of 101 countries over the period 1970–2005. Second, the paper tries to shed some light to the much debated issue of whether globalisation affects economic growth and, in so doing, whether convergence in globalisation brings about convergence in per capita income. The results obtained are both encouraging: on the one side, as it is shown that there has been a clear process of globalisation convergence; on the other, the paper concludes that globalisation has been one of the main drivers of economic growth, thus fostering convergence in per capita income.

Productivity convergence in the European regions, 1980-2003: a sectoral and spatial approach

This article analyses the evolution of the EU productivity between 1980 and 2003, both across regions and sectors. By making use of various techniques (cross-section, nonparametric and spatial approaches) it concludes that: (1) the regional and sectoral dispersion of productivity is quite high; (2) the gains experienced in aggregate productivity are due entirely to the sectors productivity growth effect; (3) there is a weak beta-convergence process at the aggregate and sectoral levels; (4) the accounting decomposition of the aggregate productivity convergence process reveals the sectoral productivity growth effect to be the only responsible factor for regional catching-up; (5) finally, there are clear signs of spatial dependence which, when properly addressed, increase the speed of convergence at the aggregate level.

Provincial Disparities in Post-reform China

Using conventional and novel techniques, the present paper analyzes the main characteristics of Chinese provincial disparities during the reform period, specifically between 1978 and 2007. After dismissing the presence of spatial dependence, three main results are obtained: first, provincial inequalities have basically followed a “V” trend; second, grouping China into three large regions shows that inequality mainly lies within each region, particularly in coastal areas; and third, the analysis of intra-distribution dynamics reveals that, although there was some significant mobility in provincial relative income, particularly until 1990, the whole period persistence in the ranking of income levels is a major feature. This might provoke some changes in the policy approach to dealing with spatial disparities.

A New Look to Convergence in Spain A Spatial Econometric Approach

This article examines the process of provincial convergence which has taken place in Spain between 1985 and 2002. Focusing on labour productivity, it estimates the so-called ‘classical’ models of convergence, concluding that, contrary to what has been suggested by previous work, convergence has not stagnated. After stressing the limitations of this type of approach, the article attempts to overcome them, by, on the one hand, estimating the density function and the degree of internal mobility in the provincial productivity distribution; and on the other hand, by considering the influence of possible spatial effects on the aforementioned distribution. The conclusion arrived at is threefold: we confirm the existence of provincial convergence of productivity; we reveal the low level of intradistributional mobility; and we do indeed find spatial effects, although they do not seem to be too relevant for the convergence process.

Provincial Wages in Spain: Convergence and Flexibility

This paper analyses the performance of provincial Spanish wages during the period 1985—2003. Using both traditional and recent analytical approaches, related to spatial econometrics, non-parametric and semi-parametric techniques, the paper reveals that a process of wage convergence has taken place. However, this does not preclude that mobility within the provincial wage distribution is small. The paper also shows that the degree of provincial wage flexibility is very low, which is in accordance with the institutional framework of wage formation in Spain.

Trade openness, income levels, and economic growth: The case of developing countries, 1970--2009

This paper attempts to investigate the extent to which trade openness has had an impact on the levels of income and rates of growth in a sample of 115 developing countries for the period 1970–2009. Additionally, to assess whether there is an income level threshold for a country to benefit from international trade, the sample is broken down into three mutually exclusive groups of countries: low-income, lower middle-income, and upper middle-income countries. The main novelty of the paper lies on the use, on the one hand, of a new and better trade openness measure and, on the other hand, of non-stationary heterogeneous panel cointegration techniques to cope with the problem of cross-sectional dependence. The results show a positive bi-directional relationship between trade openness and income level in the long run, thus suggesting that trade openness is both a cause and a consequence of the level of income. The results for the short run, that is, the link between openness growth and economic growth, go in the same direction.

Provincial convergence in Spain: a spatial econometric approach

This article examines the process of provincial convergence in labour productivity that has taken place in Spain between 1985 and 2002. In order to quantify the influence of space on the convergence process, it applies a spatial econometric approach, concluding that although spatial effects do indeed exist, they do not seem to be too relevant for the aforementioned process.

Regional Productivity Distribution in the European Union: Which are the Influencing Factors?

The aim of this paper is to analyse some relevant aspects on productivity distribution in the European Union at regional level. Firstly, the paper examines its external shape and intra-distribution dynamics. Subsequently, an analysis of the factors that might be behind the productivity distribution and its dynamics is carried out. The results, represented by means of a relatively new visualization tool, highlight the role played by factors such as geographical location, compensation per employee and investment per employee in explaining this issue.

Convergence or Twin Peaks: The Spanish Case

This paper aims to explore the Spanish geographical dynamics of per capita income among provinces, during the period 1955-1997. First, we obtain some preliminary evidence of their behavior over time from the visual inspection of their non-parametric density distributions. These distributions turn to be unimodal in virtually all cases. Next, we compute the transition matrices and the long run equilibria by means of the Markov Chains approach, (along the lines of the contributions of Quah). Basic outcomes of this analysis also tend to predict a patter of convergence among provinces for the period 1955-97. Therefore, and according to these results, the existence of twin peaks in Spanish income distribution does not seem to be supported by the empirical evidence presented here. Other tentative conclusions of the paper are the high level of persistence in the relative position of provinces, consistent with a low degree of mobility in the income distribution. Notwithstanding this fact, the paper detects some particular changes in the placement of provinces according to their per capita income. More specifically, the richest provinces tend to concentrate gradually in the North-East of the country, which may be attributed, in turn, to externalities linked to localization or to the proximity to the rest of Europe. Sectoral reallocation to the industrial sector also seems to have fostered growth of per capita income in those provinces that have experienced it over time.