Economic development and convergence in Greek regions 1970-1994: alternative methodological approaches

Abstract

The aim of this research is to examine spatial income disparities in Greece at the NUTS III level for the 1970-1994 period using alternative conceptual and methodological approaches to economic convergence. As far as the concepts of and conditional convergence are concerned, the evidence has been overall supportive. To the extent that convergence is understood as decreasing variance of GDP per capita across space over time (convergence), this research records a rather weak tendency towards convergence. However, a more detailed analysis of spatial income distribution regarding both the time evolution of the external shape of the distribution and intra-distributional dynamics suggests that the external shape of the distribution is evolving in time without, however, significantly affecting the number of the poorer regions. Mobility is limited in the part of the distribution that relates to more prosperous, than average, regions. On these grounds real economic convergence cannot be supported. Foremost, an increased mobility manifests itself in the central parts of the distribution, which in turn, leads to the emergence of a group of regions outperforming national average and being at the same time behind leading regions. This process is slow. However, in the instance that it will be further enhanced in the future, it may lead to serious polarization.