OLS and GWR Approaches to Agricultural Convergence in the EU-15

This paper contributes to the current debate moderated by the European Commission on the territorial dimension of the economic and social cohesion, investigating the role of the CAP in the agricultural convergence process across a sample of 166 EU-15 regions at NUTS2 level from 1995–2005. The empirical study compares results from GWR and OLS models of absolute and conditional β-convergence where total transfers provided by the CAP and Structural funds expenditure related to agriculture, rural development and fishery are the conditioning variables. Furthermore, GWR approach allows detecting the parameters spatial non stationarity and the role of spatial dependence and heterogeneity of regions. The results provide useful insights on important policy sensitive issues difficult to be predicted with the traditional global estimate. They reinforce the prescriptions of the economic geography theory and new economic growth theory on convergence.