Disparities in employment, productivity and output in the EU: The roles of labour market governance and welfare regimes

The aim of this paper is to develop a set of empirical and theoretical connections between geographies of inequality on the one hand and geographies of productivity and of the mobilization of human potential on the other. To this end it presents a brief account of the current map of regional inequality in the EU. Disparities in Gross Domestic Product per head are shown to depend on two elements: differences in productivity and differences in the employment rate which, it is argued, reflects the capacity of an area to mobilize its human potential. An analysis of data for NUTS 1 regions in the EU and for neighbouring countries shows that the respective roles of productivity and employment rate differentials in explaining variations in output per head vary quite markedly from one region to another. To interpret these empirical results it is argued, first, that geographies of output, productivity and employment can in part by explained by differences in the regulatory orders that prevail in different countries and regions and, second, that conceptions of regional performance must be widened to consider not just the dynamics of the productive order but also the structure and organization of the market for labour and its articulation with the system of social reproduction.