Growth and divergence of the polish subregions over 1995{2006: a search for determinants and spatial patterns

This paper investigates the presence of sigma and beta convergence between the Polish subregions over 1995–2006. We verify for the absolute convergence, as well as for the convergence conditioned on the stock of physical capital, human capital and the size of the central city, these being emphasised in the literature as important factors of regional growth. We also test for the presence of spatial effects in the determination of regional growth rates. In line with research from other countries, we observe a sigma divergence and unconditional beta divergence rather than convergence of income across Polish subregions. Conditional convergence is observed only between the regions around cities of similar size. Large agglomerations in particular increase their economic advantage over peripheral regions during dynamic growth periods in the Polish economy, while during periods of economic slowdown the human capital stock proves significant in determining regional growth.