Spatial regimes in regional European growth: an iterated spatially weighted regression approach.

This paper proposes a new technique based on an iterated spatially weighted regression procedure to verify the presence of economic growth heterogeneities in EU regions in the period 1981–2009. The approach extends a procedure originally proposed in the field of image analysis based on the assumption of local homogeneity of the signal. The presence of the heterogeneity is a criterion to divide the sample of observations (i.e. regions) into smaller homogeneous groups. Our results highlight the presence in the EU regions of five different clubs with different growth paths within each subgroup. Spatial dependence is also considered in the definition of the economic convergence model.