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Regional Growth and Convergence : Heterogeneous Reaction Versus Interaction In Spatial Econometric Approaches

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Executive Summary

This paper presents various approaches dealing with heterogeneous reaction combined with interaction between neighboring units of observation developed in the spatial econometric literature, in the framework of cross-sectional models, and applied to the study of growth and convergence processes. The authors present the main econometric specifications capturing discrete or continuous spatial heterogeneity: the spatial regimes model and the locally linear, Geographically Weighted Regression (GWR). They then examine how these specifications can be extended to further allow for spatial autocorrelation.

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