Abstract
Research background: Given the pivotal role of innovations and technological progress in shaping the economic development of regions and the crucial significance of spatial dimension of innovation processes at the regional level, the assessment of technological convergence in the regional scope becomes an essential research problem. Technological convergence could be identified on the basis of the analysis of total factor productivity (TFP). The significance of the technological convergence analysis results from the fact that income convergence can be both accelerated or impeded, depending on whether the initial differences in the level of technology (TFP) decrease or increase over time.
 Purpose of the article: The aim of the paper is twofold. Firstly, we attempt to develop a theoretical framework for the analysis of the technological convergence. Secondly, we investigate the technological convergence (on the basis of the TFP analysis) across European regions.
 Methods: During the first stage of the research, we employ the multiplicatively-complete Färe-Primont index to calculate TFP. The second stage of the study includes estimation of spatial panel models applied to assess the level of technological convergence across European regions. The research sample consists of 273 NUTS 2 European Union (EU) regions over the period 2010? 2016.
 Findings & Value added: The results of the study confirm a clear division of Europe into the Western European regions with high TFP values and the Eastern European regions with low TFP level. The research also shows that in the Eastern European regions the process of reducing the differences in the productivity levels is faster than in Western European regions. Since the issue of technological convergence is still not sufficiently explored in the relevant literature our paper attempts to fill a cognitive and methodological gap in the investigation of the technological convergence in the European regional space.
Highlights
Abundant evidence in the relevant literature indicates that the existing disparities in regional economic development can be predominantly attributed to differences in productivity (Islam, 2003a)
A significant part of the identified differences in the per capita income that remains unexplained after taking into account the differences in physical or human capital, can be attributed to Total Factor Productivity (TFP) that determines how efficiently and intensely the available inputs are used in production
The regions with the highest total factor productivity (TFP) values belong to the ‘old’ European Union (EU), which specializes in knowledge-intensive services (KIS) (Marrocu et al, 2013)
Summary
Abundant evidence in the relevant literature indicates that the existing disparities in regional economic development can be predominantly attributed to differences in productivity (Islam, 2003a). Recent theories of growth and development suggest that heterogeneity with respect to technological conditions in general and TFP in particular are identified as the most decisive factors responsible for the absence of absolute income convergence of countries and/or regions. This view is consistent with Otsuka et al (2010), who showed that the majority of regional economic growth is explained by a region’s unique technological potential. Since the issue of technological convergence is still not sufficiently explored in the relevant literature our paper attempts to fill a cognitive and methodological gap in the investigation of the technological convergence in the European regional space
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