Fiscal Design and the Location of Economic Activity

In the process of economic integration regional production structures are about to change. Several studies analysed already trends of regional specialization in the European Union and attempted to figure out determinants of observed changes. In this context, up to date the role of the public sector and especially the impact of different fiscal designs as determinants of the change in production structures have been left aside. Advantages and shortcomings of decentralized government organization have been largely discussed theoretically within the last decades. Several empirical studies attempted to examine the impact of decentralization on national performance, e.g. economic growth and fiscal stability. This paper aims at linking these two subjects and analyzes the empirical relationship between regional specialization and fiscal decentralization for a panel of 15 Member States of the European Union, controlling for regional and other institutional determinants. The analysis shows that rather autonomous regions tend to diverse their production structure in order to insure against adverse supply shocks.

Fiscal Design and the Location of Economic Activity

In the process of economic integration regional production structures are about to change. Several studies analysed already trends of regional specialization in the European Union and attempted to figure out determinants of observed changes. In this context, up to date the role of the public sector and especially the impact of different fiscal designs as determinants of the change in production structures have been left aside. Advantages and shortcomings of decentralized government organization have been largely discussed theoretically within the last decades. Several empirical studies attempted to examine the impact of decentralization on national performance, e.g. economic growth and fiscal stability. This paper aims at linking these two subjects and analyzes the empirical relationship between regional specialization and fiscal decentralization for a panel of 15 Member States of the European Union, controlling for regional and other institutional determinants. The analysis shows that rather autonomous regions tend to diverse their production structure in order to insure against adverse supply shocks

Regional specialisation and sectoral concentration: an empirical analysis for the enlarged EU

Already within the current EU15, differences in national and regional economic specialisation are considerable. After the enlargement of the European Union in 2004, the diversity in the EU will increase statistically. In reality, the on-going economic integration in Europe already has effects on relative and absolute wealth positions as well as on structural change. Since years we may observe an ongoing debate, how international trade within the enlarged EU will affect different countries. Besides that, differences in regional specialisation between current and new as well as within individual member states may influence the strategy of national and European regional policy. Until recently, the data base for calculating the relevant indicators and providing an international comparison was weak. Recently, new sectoral and regional data became available in Eurostat's Regio database for most current and various new EU member states on NUTS 2 level, commonly using the new European System of National Accounts (ESA95). Based on these new data the paper will present results from various indicators on the differences in regional specialisation in the current as well as in the new member states