Modelling and Forecasting Regional Growth: The MASST Model

Abstract

Among the vast number of regional growth forecasting models, the past 15 years witnessed the emergence of the MAcroeconomic, Sectoral, Social, Territorial (MASST) model. The MASST model aims at merging macroeconomic elements with territorial features for forecasting regional growth trajectories. In fact, the model was created with the aim to overcome the dichotomous approaches interpreting regional growth either as a bottom-up process without macroeconomic elements, or a top-down one, whereby national growth rates are reassigned to regions according to their weights, neglecting any role that regional propulsive forces may have. The model has now reached its fourth generation. The aim of this chapter is first to present a discussion of the theoretical framework where the MASST model was first conceived, and then to highlight the advances of the model. Each new version was inspired by crucial events that influenced the structural relationships estimated in the model. The paper concludes highlighting the model’s predictive power for assessing possible future growth patterns of European regions, and hinting at possible research directions for the next generation of the model.