Spatial econometrics usually hands you the neighborhood map before you start. This tutorial estimates it from the data instead, using the estimateW package on 90 European NUTS-1 regions, 2001-2019.
Our results highlight the joint importance of structural change and spatial dependence in the formation of convergence clubs. Specifically, the notion of spatial structural change deserves further attention, as it appears to play a major role in the evolution of regional disparities in the European Union.
Divergence in learning outcomes is increasing over time. Institutional and learning spillovers are decisive for whether an EU Member State is on a high or low human capital trajectory.