1 European Regional Knowledge Spillovers and Technological Convergence: A Maximum Entropy Markov Model Kostas Karantininis Institute of Food and Resource Economics, University of Copenhagen, Denmark Nikos C. Varsakelis Department of Economics, Aristotle University of Thessaloniki, Greece This paper was written while Nikos Varsakelis was visiting the Institute of Food and Resource Economics, University of Copenhagen. Nikos Varsakelis acknowledges the financial support from the Institute of Food and Resource Economics, University of Copenhagen and the Aristotle University of Thessaloniki. Christos Varsakelis provided research assistance. The authors would like to express their gratitude to P. Stoneman, F. Archontakis, V. Souitaris, C. Emmanuilidis, E. Dinopoulos, N. Vonortas, the attendants of the seminars in Max Planck Institute, Institute of Food and Resource Economics, University of Copenhagen, University of Patras, and 1 st International Conference in Regional Economics, Thessaloniki. The usual disclaimer applies. Corresponding Author: Kostas Karantininis, FØI, LIFE, KU, Rolighedsvej 25-C DK 1958 Frederiksberg C, Denmark, tel: +45-30239503, kok@life.ku.dk Author names appear in alphabetical order – no senior authorship assigned.