This paper investigates the role of human capital formation in determining spatial disparities in economic performance. An informal model attempts to explain why spatial inequalities in economic performance persist over the long run. Empirical evidence indicates that the critical variable in this process is the proportion of high skill workers in a locality. Localities with a poor economic performance invariably have a low proportion of high-skill workers. The main conclusion is that government policy needs to focus on improving educational attainment and workforce skills in low income / high unemployment areas if their competitiveness is to be substantially improved.

Jim Taylor, in "SCIENZE REGIONALI " 2/2003, pp. , DOI: