Boosting productivity in European regions through structural change revolutionizes economies.
Labor productivity growth is crucial for regions to develop and improve living standards. By analyzing productivity changes, researchers found that regions with positive structural changes, like moving resources to modern sectors, see higher overall productivity growth. They used a model to study how different factors impact productivity growth, including characteristics of the region and its neighbors, spatial connectivity, and spatial dependence. The model showed that changes in one region can affect others through spatial relationships.