Co-evolutionary patterns in regional knowledge bases and economic structure: evidence from European Regions

This paper presents an analysis of the co-evolutionary patterns of structural change in knowledge and economics. The former is made operational through an analysis of co-occurrences of technological classes in patent documents in order to derive indicators of coherence, variety and cognitive distance. The latter, on the other hand, is made operational in a synthetic way by implementing shift share analysis which decomposes labour productivity growth into effects caused by changes in the allocation of employment, those ascribed to intra-sector productivity growth and those caused by interaction of these two components. The results of the analysis conducted on a sample of 227 European regions show that increasing variety is associated with the reallocation of workforce across sectors whereas within sector productivity is associated with high levels of both coherence and cognitive distance of the regional knowledge base. JEL Classification Codes: O33, R11