The influence of economic growth on regional disparities: Empirical evidence from OECD countries

Abstract

© 2016, UNIVRIJEKA. All rights reserved. In the context of growing regional disparities which exist both in developed and developing countries, the primary goal of this paper is to examine the influence of total economic activities on regional disparities. In the research panel sample of the selected OECD countries has been used with the data for the time period from 2000 to 2011. The empirical analysis reveals that there is a long-term relationship between the variables, that economic growth and regional disparities move in the same direction and that the impact of economic growth on regional disparities is statistically significant. Consequently, in order to reduce regional disparities, it is necessary to increase the share of less developed regions in the total output. In this matter, it should be helpful to adequately coordinate policies about regional development from all levels of governance.