average GDP per capita in the EU, but have grown slower than low growth regions that are already high income. Indeed, 17% of this group of 171 regions recorded a _negative_ average yearly GDP per capita growth rate over the period 2003-2017. Examples include the Greek region of Thesprotia which recorded an average growth rate of minus 2.4%, and the Greek region of Ioannina which recorded an annual growth rate of minus 0.02%. Figure 5 plots the growth rates against income level. Clearly the most variation in growth rate is among the lowest income regions: these regions have grown faster on average, but with very substantial heterogeneity.

_Table 7: Time average of yearly GDP per capita growth over the period 2003-2017._

|Taxonomy|Averae Yearl GDP Per Caita Growth|
|---|---|
|Income Level|g y p|
|High-Income<br>Transition|2.21<br>2.19|
|Less Developed<br>Low-Income|2.11<br>6.12|
|Long-Run Growth Rate||
|High-Income, High-Growth|2.83|
|High-Income, Low-Growth|1.11|
|Not High-Income, High-Growth|4.87|
|Not High-Income,Low-Growth|0.72|
|Decline in Average GDPper capita around the Great Recession||
|Not Declined|3.31|
|Declined|0.82|

Notes: Authors’ elaboration on Eurostat data. Time average of the yearly GDP per capita growth rate in percentage terms over the period 2003-2017. High-income regions are those with an average yearly GDP per capita over the period 2003-2017 equal to or greater than the 90% of the sample average. Transition regions are those with an average yearly GDP per capita over the period 2003-2017 equal to or greater than the 75% of the sample average, but lower than the 90% of the sample average. Less developed regions are those with an average yearly GDP per capita over the period 2003-2017 equal to or greater than the 50% of the sample average, but lower than the 75% of the sample average. Low-income regions are those with an average yearly GDP per capita over the period 2003-2017 lower than the 50% of the sample average. High- (not high-)income regions are those with an average yearly GDP per capita over the period 2003-2017 equal to or greater than (lower than) the 90% of the sample average. High- (low-)growth regions are those recording a long-run growth rate of GDP per capita between the years 2003 and 2017 equal to or greater than (lower than) the 50% of the sample average. Decline of GDP per capita around the Great Recession is defined by comparing the average yearly GDP per capita over the pre-crisis period 2003-2007 with the average yearly GDP per capita over the subsequent period 2008-2017.

**The varied performance of NUTS-3 regions is shown particularly in their trajectories after the Great Recession.** We examine the performance of NUTS-3 regions in the pre-crisis period 2003-2007 and the subsequent period 2008-2017, to find the proportion of regions that experienced a decline in the average yearly GDP per capita between the two periods. According to data summarized in Table 8, the share of ‘declining’ NUTS-3 regions is 20.4% among ‘high-income’ regions, 28.9% among ‘transition’ regions, 27.3% among ‘less developed’ regions, and only 2.8% among ‘low-income’ regions.<sup>29</sup> Such a pattern emerges clearly from Figure 6, which plots the average GDP per capita among each category of NUTS-3 region.  On average, ‘low-income’ regions have recorded a better trend than regions in the other three categories. This finding suggests that ‘lowincome’ regions may not be as much of a problem for Cohesion Policy than declining and ‘lowgrowth’ regions in the less developed and transition categories. In subsequent analysis, we group the transition, less developed, and low-income regions together as a ‘not high-income’ category.

> 29 Appendix Table A7 (available on request) reports the distribution of regions by their declining vs. non-declining status in terms of average yearly GDP per capita around the Great Recession and by country. Figure A6 (in appendix, available on request) spatially identifies those regions that have recorded a decline in average yearly GDP per capita between the pre-crisis period 2003-2007 and the subsequent period 2008-2017.

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