In this paper we challenge the ability of the conventional methods initiated by Barro and Sala-i-Martin in the early 1990s to detect actual convergence or divergence trends across countries or regions and suggest an alternative dynamic framework of analysis, which allows for a better understanding of the forces in operation. With the use of a SURE model and time-series data for eight European Union (EU) member states, we test directly for the validity of two competing hypotheses: the neoclassical (NC) convergence hypothesis originating in the work of Solow and the cumulative causation hypothesis stemming from Myrdal's theories. We also account for changes in the external environment, such as the role of European integration on the level of regional disparities. Our findings indicate that both short-term divergence and long-term convergence processes coexist. Regional disparities are reported to follow a procyclical pattern, as dynamic and developed regions grow faster in periods of expansion and slower in periods of recession. At the same time, significant spread effects are also in operation, partly offsetting the cumulative impact of growth on space. Similar results are obtained from the estimation of an intra-EU model of disparities at the national level, indicating that the forces in operation are independent of the level of aggregation. Our findings challenge the view of economic growth as the main driver for a reduction of regional disparities and contribute to the growing scientific evidence that points towards the need to rethink current EU-wide regional development policies.

This article analyzes the clusters of similarities among EU member states before and during the recent financial and debt crisis, using variables from banking, taxation, government debt and deficit, and the Current Account of the Balance of Payment; our study follows the method of Multi-Sample Case of Cluster Analysis between and within groups of EU countries. Our findings show that the current economic crisis the EU is faced with is twofaceted and has arisen from the financial and banking sectors and from government debt. In this sense, problems have resulted from the credit policies of the national banking sectors and from national fiscal and budgetary controls. These two crisis facets are correlated and a new problem emerges concerning the fiscal similarities of European Monetary Union (EMU) countries and the necessity for a fiscal union or for common fiscal policies between them. The aim of this article is to help us understand that the current EU crisis is due to the lack of homogeneity in fiscal and financial polishes across the Union.

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Lambrinidis M., Psycharis Y. and Rovolis A. (2005) Regional allocation of public infrastructure investment: the case of Greece, Regional Studies 39 , 1231–1244. This paper develops a model on the determinants of the regional allocation of public infrastructure investment and applies it to Greece for 1982–94 using panel methods of estimation. The principal conclusions are that regional allocations of infrastructure investment (1) were negatively associated with regional product per capita as well as with population size and population density, (2) were positively associated with the existing stock of infrastructure capital as well as with the share of agriculture in regional Gross Domestic Product, and (3) were increased across prefectures in years preceding national elections. These results are related to national and European regional policy.Infrastructure, Public investment, Regional economics, Regional policy, Political business cycle, Equipement, Investissement collectif, Economie régionale, Politique régionale, Cycle économique politique, Infrastruktur, Öffentliche Investierungen, Regionalwirtschaft, Regionalpolitik, Politischer Geschäftszyklus, Infraestructura, Inversión pública, Economía regional, Política regional, Ciclo político de empresas, JEL classifications: H54, R53, R58,