Selected Issues Papers

Spain’s Productivity Gap Vis-à-Vis Europe and the United States: Diagnosis and Remedies

By Ippei Shibata

June 13, 2025

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Format: Chicago

Ippei Shibata. "Spain’s Productivity Gap Vis-à-Vis Europe and the United States: Diagnosis and Remedies", Selected Issues Papers 2025, 077 (2025), accessed July 20, 2025, https://doi.org/10.5089/9798229012553.018

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Summary

Spain's GDP per capita gap with highest-income euro area economies and the US is mainly due to a productivity shortfall. Spanish tech firms lag in productivity and innovation, partly due to weaker R&D investment. Beyond leading firms, there's a broader lack of dynamism; firms enter small and fail to scale up, resulting in fewer high-growth firms compared to Europe and the US. This scarcity of "gazelles" is linked to limited venture capital, human capital, and regulatory obstacles. Policy remedies include enhancing market integration, improving access to long-term risk capital, and boosting the innovation ecosystem and higher education quality.

Subject: Production, Productivity

Keywords: Economic policy uncertainty, Europe, Firm heterogeneity, Gap Vis-à-Vis Europe, Global, Investment, Leverage, Policy remedy, Productivity, Productivity shortfall, Profitability, R&D investment, Spain's GDP

Publication Details

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