Umeå Economic Studies, Department of Economics, Umeå University
No 632:
Productivity convergence across industries and regions in Norway and Sweden
Stein Östbye ()
and Olle Westerlund ()
Abstract: Several authors have asked why the differences in output
per worker between countries are so large and hypothesized that differences
in social infrastructure provide an answer. However, differences in output
per worker also vary considerably when comparing spatial units at lower
levels of resolution, without substantial variation in the social
infrastructure. The purpose of this paper is to discuss possible reasons
for regional differences based on data for the Scandinavian Peninsula at a
spatial resolution almost equivalent to the European NUTS3. Since Norway
and Sweden are considered to be particularly egalitarian and homogeneous
societies, differences in broad measures of social infrastructure can
hardly be invoked as substantially important determinants of productive
performance. Instead, we investigate the role played by industrial
structure. We find strong productivity convergence between Norwegian
regions and weak divergence between Swedish ones. For Norway, there is
convergence in primary production, manufacturing and services. For Sweden,
there is divergence, except in the primary sector. The effect of the
industry structure on the spatial distribution of productivity appears to
be small in magnitude, but is qualitatively important at least for one time
period. The data cover 5-year intervals from 1980 to 2000 for Norway and
from 1985 to 2000 for Sweden.
Keywords: growth; productivity convergence; comparative study; European regions; (follow links to similar papers)
JEL-Codes: O41; O57; R11; (follow links to similar papers)
48 pages, April 2, 2004
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