## Regional Disparities in Europe

_IMF Working Papers, September 30, 2022_

## Source details

**Canonical URL:** [Regional Disparities in Europe](https://www.imf.org/en/publications/wp/issues/2022/09/30/regional-disparities-in-europe-523583)

## Other formats

- [Markdown version](/en/publications/wp/issues/2022/09/30/regional-disparities-in-europe-523583/index.md)
- [Structured JSON version](/en/publications/wp/issues/2022/09/30/regional-disparities-in-europe-523583/index.json)
- [Bundle manifest](/en/publications/wp/issues/2022/09/30/regional-disparities-in-europe-523583/bundle-manifest.json)

## Bibliographic details
- Authors: Ravi Balakrishnan, Louise Rabier, Christian H Ebeke, Melih Firat, Davide Malacrino
- Published: September 30, 2022
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798400219184.001

---

### Summary and key findings
- Study scope: 10 advanced European economies.
- While the level of disparities across regions mostly reflects productivity gaps, the increase since the Great Recession has resulted from diverging unemployment rates.
- Following the pandemic, disparities could be further exacerbated because teleworkability rates are lower in poorer regions than in high-income regions, making poorer regions ex-ante more vulnerable to the pandemic’s likely material impact on the prevalence of remote work.
- Preliminary evidence from 2020 confirms that regional disparities between countries increased during 2020.
- The pandemic might accelerate the automation of jobs across Europe, a pattern that often follows recessions.
- Lagging regions have lower ex-ante vulnerabilities against routinization, but the transformation of jobs through sectors with higher routinization rates in these regions could increase their vulnerability to technological change over time.
- The green transition could lead to challenges for regions that have benefitted from carbon-intensive growth strategies.
- The paper discusses the role for policies—including place-based ones—in reducing disparities in the face of the aforementioned short, medium, and long-term risks.

### Short-, medium-, and long-term risks identified
- Short term: Pandemic-related shifts in remote work prevalence, with poorer regions more vulnerable due to lower teleworkability rates.
- Medium term: Acceleration of automation following the recession, producing sectoral job transformations that may increase vulnerabilities in lagging regions.
- Long term: Green transition adjustment costs for regions reliant on carbon-intensive growth strategies.

### Policy implications and recommendations
- Consider place-based policies to reduce regional disparities while addressing pandemic-induced shifts in work patterns.
- Anticipate and manage the distributional effects of automation, particularly where sectoral changes could expose lagging regions to higher routinization.
- Design transition strategies for regions dependent on carbon-intensive industries to mitigate adverse effects of the green transition.

---

## Content in this bundle

- **Working Paper**
  - [Working Paper (Markdown version)](/-/media/files/publications/wp/2022/english/wpiea2022198-print-pdf.pdf.md){rel="alternate" type="text/markdown"}
  - [Working Paper (PDF)](/-/media/files/publications/wp/2022/english/wpiea2022198-print-pdf.pdf){rel="external" type="application/pdf"}

---

_Source: https://www.imf.org/en/publications/wp/issues/2022/09/30/regional-disparities-in-europe-523583_