Regional welfare disparities: the case of the European Union

The regional welfare distribution in the European Union between 1993 and 1998 is examined, using several complementary methodologies. The results obtained show a reduction in regional welfare disparities over the period analysed. It is worth noting, in this respect, however, that regional productivity differences prove to be the main determinant behind observed welfare inequality in the European context. Moreover, there has also been a decline in regional bipolarization over the six-year contemplated, while the degree of observed intradistributional mobility is relatively low. The empirical evidence presented, nevertheless, reveals the importance of variables such as the national component, the spatial location, the regional productive structure or the percentage of GDP devoted to investment or to R&D expenditure, in accounting for the dynamics of the distribution under analysis.