Cross-region analysis through a myopic leader-follower model

Csillik, P. and Tarján, T. (2010) Cross-region analysis through a myopic leader-follower model. Acta Oeconomica, 60 (2). pp. 143-159. ISSN 0001-6373

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Abstract

The paper is a contribution to the empirics of cross-country and cross-region literature on growth economics. Its aim is to assess the role of the global component in the development of European regions during the period 2000–2005. For this purpose a simple leader-follower model is set up in which all countries imitate the technology of the leader. The model is applied to cross-country data of the period 1870–2003 as corroboration and to the cross-region data. This approach makes it possible to rank the regions based on the rate of return of broadly understood capital and the impact of global forces as compared to local ones. Finally, a conclusion is drawn on the extent of the role of imitations in the growth of European regions.

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