e"> The aim of this study is to investigate whether openness, export shares or trade balances affect regional
growth in Portu gal. Human capital is also considered as a conditional factor to growth, expressed by the rate of
success in high school education. Thus, we analyse whether the combination of internat ional trade and human
capital is relevant to explain regional growth in Portugal and how it affects the convergence process between
regions. In the empirical analysis, interactio n terms are introduced to explore the existence of different
performances between regions of the Littoral and the Interior. As an alternative to the traditional approach
that considers the population growth rate, we include the share of sectoral employment aiming to capture
labour specialisation in the main sectors of economic activity and measure its impact on regional growth.
The empirical analysis estimates the conditional convergence model of the Barro's type, applied to the
Portuguese NUTS3 regions for the period 1996–2005. The GMM estimation approach applied to regional panel
data reveals that factors associated with external trade, human capital and sectoral labour share (especially of
the industrial sector) are relevant to explain regional growth and convergence in Portugal.
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Economic Modelling