nep-geo New Economics Papers
on Economic Geography
Issue of 2005‒10‒22
nine papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. New Economic Geography and Regional Price Level By Reinhold Kosfeld; Hans-Friedrich Eckey; Matthias Türck
  2. Economic Structure, Technology Diffusion and Convergence: The Case of the Italian Regions By Matteo Lanzafame
  3. Secteur culturel, métropolisation et centralités urbaines: le cas de l'Ile-de-France. By BAUMONT, Catherine; BOITEUX-ORAIN, Céline
  4. Relative Centrality or Peripheriality and the Growth Effects of Relative Centrality or Peripheriality and the Growth Effects of Economic Integration within the European Union By Tomasz Brodzicki
  5. Trade and Industrial Location with Heterogeneous Labor By Mary Amiti; Christopher A. Pissarides
  6. Russia's Regions: Income Volatility, Labor Mobility and Fiscal Policy By Antonio Spilimbergo; Goohoon Kwon
  7. Sistemas Locales de Trabajo y Distritos Industriales Marshallianos en España By Rafel Boix Domenech
  8. Job-Hopping in Silicon Valley: Some Evidence Concerning the Micro-Foundations of a High Technology Cluster By Bruce Fallick; Charles A. Fleischman; James B. Rebitzer
  9. Regional Economic Disparities in Australia By Martin D. Cerisola; Uma Ramakrishnan

  1. By: Reinhold Kosfeld (Department of Economics, University of Kassel); Hans-Friedrich Eckey (Department of Economics, University of Kassel); Matthias Türck (Department of Economics, University of Kassel)
    Abstract: In view of the lack of area-wide regional price data, Aten and Heston (2005) adopted an econometric approach in estimating regional price level from an international perspective. At a regional level, however, spatial economic theory may contribute to advancement in explaining price level determination. Recently, the market potential approach as an essential element of NEG models has been employed for explaining observed regional land prices (Brakman et al., 2004). The present paper relies on the price mechanisms of the Helpman model (Helpman, 1998) in developing spatial-econometric models for regional price level and its major components. By evaluating a south German sample, first evidence on the empirical significance of NEG-based price level models is provided.
    Keywords: Regional price level, Helpman model, spatial-econometric models, ESDA
    JEL: C21 R13 R31
    Date: 2005–10
  2. By: Matteo Lanzafame
    Abstract: Taking Italy as a case study, this paper investigates the link between economies' structural similarities and convergence. Specifically, treating technology as sector-specific and modelling technological spillovers as a positive function of the degree of similarity between economies' sectoral features, we propose a modified version of the Solow model and derive an "extended" convergence equation. The latter is then estimated by means of Panel Data procedures and data on the Italian regions over the 1970-1995 period. The results bring empirical support to our approach.
    Keywords: Convergence; Technology Diffusion; Regional Growth; Italy
    JEL: O40 R11
    Date: 2005–10
  3. By: BAUMONT, Catherine (LEG - CNRS UMR 5118 - Université de Bourgogne); BOITEUX-ORAIN, Céline (THEMA - CNRS UMR 6049- Université de Bourgogne)
    Abstract: Elevées depuis longtemps au titre de fonctions des places centrales, les activités culturelles se localisent plus massivement et de manière plus diversifiée dans les plus grandes agglomérations, la hiérarchie s'établissant aussi bien à l'échelle d'un pays qu'au sein des territoires plus restreints. Dans ces conditions, l'économie géographique des activités culturelles peut être associée à des schémas de polarisation de type centre-périphérie. Cependant la croissance de ce secteur et la diversité des activités le composant peut amener des modifications dans ce schéma si on se réfère notamment aux recompositions contemporaines des centralités urbaines. L'objectif de cette recherche est d'étudier cette question dans le cas de la région Ile-de-France. Après avoir établi la diversité du secteur culturel et ses relations à la métropolisation des économies, nous avons étudié l'économie géographique des activités culturelles au sein de la région Ile-de-France et ses évolutions entre 1978 et 1997. Nous avons montré que l'économie culturelle francilienne reste dominée par l'identité culturelle parisienne et que les facteurs de recomposition des centralités urbaines n'altèrent pas les logiques de localisation des activités culturelles : si les pôles culturels ne sont pas tous parisiens, ils sont pour la plupart d'entre eux dynamisés par l'économie culturelle parisienne et se localisent directement en périphérie de la capitale. Les fonctions centrales du CBD restent ainsi nettement associées aux activités culturelles supérieures et aucun mouvement de formation de Edge Cultural Cities n'est observé entre 1978 et 1997 en Ile-de-France, phénomène qui contraste alors avec celui observé dans le champ des services supérieurs aux entreprises. / Considered for many centuries as central place functions, more cultural activities of different types locate in the largest cities and are distributed through a hierarchical urban system we could observe at different territorial levels : national level or regional level for example. The economic geography of cultural activities appears then as polarization patterns such as core-periphery patterns. Taking into account the strong economic growth of this sector and the diversity of its activities together with the recent changes in urban patterns, lead us to reconsider the core-periphery hypothesis and we study this question in the case of the Ile-de-France Region between 1978 and 1997. We first established the diversity of the cultural sector and its strong links with the metropolisation process. We showed that the cultural economy of the Ile-de-France Region is strongly dominated by the Parisian cultural identity: even when cultural subcenters were identified, they didn't seem to create cultural agglomeration economies. Moreover, despite the development of urban subcenters and the location of high order services towards peripheral areas, our study showed that high order cultural activities are still central place functions and that the cultural CBD grew between 1978 and 1997.
    Keywords: secteur culturel ; métropolisation ; polarisation ; statistiques spatiales / cultural sector ; metropolisation ; polarization ; spatial statistics
    JEL: L82 R12 R14 Z1
    Date: 2005–09
  4. By: Tomasz Brodzicki (University of Gdansk, Faculty of Economics)
    Abstract: In the paper we construct two novel indices of relative centrality – peripheriality in order to test whether location has an impact on medium and long-run gains related to economic integration within the European Union. We utilize two popular econometric approaches – standard cross- sectional growth regressions as well as dynamic panel data models. The study is undertaken for a data panel consisting of 27 developed economies (15 EU Member States and 12 non-member states) within a period 1960 and 1999. Our results indicate at least to some extent that in accordance with the new economic geography models (NEG) relative location within large regional integration arrangement such as the European Union could affect growth effects associated with economic integration. Furthermore, the benefits are found to be asymmetrical between the core and peripheral regions. This results, however, need further empirical investigation as they are found to be sensitive.
    Keywords: economic growth, European economic integration, dynamic panel data models, system GMM estimator, new economic geography
    JEL: F15 O53 C23
    Date: 2005–10–18
  5. By: Mary Amiti; Christopher A. Pissarides
    Abstract: We show in the context of a new economic geography model that when labor is heterogenous trade liberalization may lead to industrial agglomeration and interregional trade. Labor heterogeneity gives local monopoly power to firms but also introduces variations in the quality of the job match. Matches are likely to be better when there are more firms and workers in the local market, giving rise to an agglomeration force that can offset the forces against trade costs and the erosion of monopoly power. We derive analytically a robust agglomeration equilibrium and illustrate its properties with numerical simulations.
    Keywords: Trade liberalization , Labor mobility , Economic models ,
    Date: 2004–07–02
  6. By: Antonio Spilimbergo; Goohoon Kwon
    Abstract: Russia's regions are heavily exposed to regional income shocks because of an uneven distribution of natural resources and a Soviet legacy of heavily skewed regional specialization. Also, Russia has a limited mobility of labor and lacks fiscal instruments to deal with regional shocks. We assess how these features influence the magnitude and persistence of regional income shocks, through a panel vector autoregression, drawing on extensive and unique regional data covering last decade. We find that labor mobility associated with regional shocks is far lower than in the United States yet higher than in the EU-15, and that regional expenditures tend to expand in booms and contract in recessions. We discuss institutional factors behind these outcomes and policy implications.
    Keywords: Fiscal policy , Russian Federation , Labor mobility ,
    Date: 2005–09–30
  7. By: Rafel Boix Domenech (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona)
    Abstract: El objetivo de la presente investigación es la identificación en España de Sistemas Locales de Trabajo (SLT) y potenciales Distritos Industriales (DI) a partir de la utilización de la metodología italiana del ISTAT. A pesar de que la estructura urbana y el sistema industrial español e italiano muestran rasgos muy similares, esta metodología no había sido aplicada en España debido a la falta de un censo industrial y de datos de movilidad laboral entre municipios. La aplicación es ahora posible al disponer de datos de movilidad laboral intermunicipal en el Censo de 2001 y utilizarse datos del DIRCE (Directorio Central de Empresas) para aproximar la dimensión de los establecimientos por sector y Sistema Local de Trabajo. La identificación para España de los distritos industriales permite el impulso de una nueva línea de política industrial que reconoce en las pymes y el territorio dos de los pilares fundamentales para el crecimiento de la productividad, y cuya aplicación se ve reforzada por la extensa experiencia italiana en la gestión de distritos industriales.
    Keywords: distritos industriales marshallianos; sistemas locales de trabajo; pequeña y mediana empresa; política industrial
    JEL: L60 R12 R23
    Date: 2005–09
  8. By: Bruce Fallick (Federal Reserve Board of Governors); Charles A. Fleischman (Federal Reserve Board of Governors); James B. Rebitzer (Case Western Reserve University, Levy Institute, NBER and IZA Bonn)
    Abstract: In Silicon Valley's computer cluster, skilled employees are reported to move rapidly between competing firms. This job-hopping facilitates the reallocation of resources towards firms with superior innovations, but it also creates human capital externalities that reduce incentives to invest in new knowledge. Using a formal model of innovation we identify conditions where the innovation benefits of job-hopping exceed the costs from reduced incentives to invest in human capital. These conditions likely hold for computers, but not in most other settings. Features of state law also favor high rates of inter-firm mobility in California. Outside of California, employers can use non-compete agreements to inhibit mobility, but these agreements are unenforceable in California. Using new data on labor mobility we find higher rates of job-hopping for college-educated men in Silicon Valley's computer industry than in computer clusters located out of the state. Mobility rates in other California computer clusters are similar to Silicon Valley's, suggesting some role for state laws restricting non-compete agreements. Consistent with our model of innovation, we also find that outside of the computer industry, California’s mobility rates are no higher than elsewhere.
    Keywords: job mobility, industrial clusters, Silicon Valley, innovation, knowledge spillovers, non-compete agreements
    JEL: R12 L63 O3 J63 J48
    Date: 2005–10
  9. By: Martin D. Cerisola; Uma Ramakrishnan
    Abstract: Australia's remarkable economic performance during the 1990s has not resulted in a significant convergence of real per capita income, output, and employment levels across the country's states and territories. This paper explores the role of certain economic rigidities that may have contributed to the lack of convergence, including rigidities in labor markets and in the structure of federal government transfers to households and subnational governments. The analysis suggests that the wage awards system has restricted the adjustment of real wages to productivity differentials, thus contributing to higher unemployment rates in some states. Federal government transfers to households also appear to have adversely affected work incentives in high unemployment states by limiting participation in the labor force.
    Keywords: Economic conditions , Australia , Wages , Government expenditures ,
    Date: 2004–08–17

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