This paper examines the growth rate volatility of European regions’ per capita GDP from 1992 to 2008. We measure the regional volatility using a new methodology based on Markov matrices, and investigate its main determinants. Volatility displays a geographical pattern and a significant spatial dependence. Output composition appears one of the main drivers of volatility; among the other determinants we find a negative impact of the size of regional economies and of labour market flexibility, and a positive impact of sectoral concentration, financialization of the economy, and, occasionally, of participation in EMU.

Volatility in European regions

BRUNETTI, IRENE;FIASCHI, DAVIDE;GIANMOENA, LISA;PARENTI, ANGELA
2017

Abstract

This paper examines the growth rate volatility of European regions’ per capita GDP from 1992 to 2008. We measure the regional volatility using a new methodology based on Markov matrices, and investigate its main determinants. Volatility displays a geographical pattern and a significant spatial dependence. Output composition appears one of the main drivers of volatility; among the other determinants we find a negative impact of the size of regional economies and of labour market flexibility, and a positive impact of sectoral concentration, financialization of the economy, and, occasionally, of participation in EMU.
Brunetti, Irene; Fiaschi, Davide; Gianmoena, Lisa; Parenti, Angela
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11568/767432
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