Income and employment disparities across European regions: The role of national and spatial factors

Income and employment disparities across European regions: the role of national and spatial factors, Regional Studies 40, 75-91. The paper analyses the impact of trends in employment rates on income convergence across European regions looking at the evolution of entire distributions. Between 1988 and 1996, European regions have been characterized by a very slow process of income convergence across countries and by a lack of income convergence within countries. While trends in labour productivity have contributed to income convergence, trends in employment rates have had a diverging impact. Polarization in employment rates also appears to be the result of national factors and of the negative performance of Objective 1 regions more than the consequence of the emergence of geographical clusters that go beyond national borders.