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This project investigates the possibility of the existence of middle-income traps among European NUTS-2 regions. Thus, the study extends the literature on middle-income traps, which has so far mainly focused on the national level, to the subnational level. Given the granularity of regional data, the study aims at improving existing spatial econometric methods by simultaneously accounting for spatial dependence, the nature of spatial spillover processes and the uncertainty regarding alternative definitions of growth regimes. Furthermore, the project focuses on analysing growth determinants of middle-income regions, such as EU regional funds, and studies factors driving regions to falling into and escaping from a middle-income trap.