Industrial Employment Growth in Spanish Regions - the Role Played by Size, Innovation, and Spatial Aspects

According to Figure 3, six regions can be classified as Group I, less developed regions
supported by small firms: Balearic Islands, Canary Islands, Extremadura, Andalucia, Castilla
y Leon and Galicia, the last two very close to national average. Four regions belong to Group
IV, industrialised regions based on large firms: Catalonia, Vasque Country, Navarre, and
Cantabria. Group II, industrialised regions based on small firms is composed by five regions:
Murcia, Aragon, Comunidad Valenciana, Castilla-La Mancha and La Rioja. Finally, Madrid
and Asturias belong to Group III, less industrialised regions based on large firms, but
Madrid’s special characteristics advice us to give it a different treatment.

If the first hypothesis assumed in the introduction is true, then the regions with the highest
growth should be those classified in Groups I and, above all, Group II: industrialised regions
with an important presence of small firms in their industrial structure.

1.2. Spanish Regional Growth.

The growth of Spanish regions during the period 1998 to 2002 is analysed taking into account
three variables: Employment; and Productivity, measured as Gross Added Value at constant
prices by employee. Table 1 presents the results for both variables:

Table 1.- Growth of Employment and Productivity. 1998-2002.

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