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This study analyses, through cross-section estimation methods, the influenceof spatial effects and human capital in the conditional productivityconvergence (product per worker) in the economic sectors of NUTs III ofmainland Portugal between 1995 and 2002. To analyse the data, Moran's Istatistics is considered, and it is stated that productivity is subject topositive spatial autocorrelation (productivity develops in a similar manner toproductivity in neighbouring regions), above all, in agriculture and services.Industry and the total of all sectors present indications that they are subjectto positive spatial autocorrelation in productivity. On the other hand, it isstated that the indications of convergence, specifically bearing in mind theconcept of absolute convergence, are greater in industry. Taking into accountthe estimation results, it is stated once again that the indications ofconvergence are greater in industry, and it can be seen that spatial spillovereffects, spatial lag (capturing spatial autocorrelation through a spatiallyredundant dependent variable) and spatial error (capturing spatialautocorrelation through a spatially redundant error term), as well as humancapital, condition the convergence of productivity in the various economicsectors of Portuguese region in the period under consideration (Martinho,2011).

Spatial Effects and Convergence Theory in the Portuguese Situation