Physical Capital Investment and Growth: Panel Data Evidence from European Regions
9 Pages Posted: 26 May 2016
Date Written: April 07, 2016
This article empirically assesses the validity of alternative growth models at regional level. This is done by comparing the stochastic properties of physical capital investment and growth using a panel unit root test statistic that is robust to cross-sectional dependence of a spatial nature. Our results for European NUTS 2 regions provide evidence more favorable to the predictions of AK-type endogenous growth models.
Keywords: Growth models, panel data, unit roots, cross-sectional dependence
JEL Classification: C31, C33, O18, R11
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