nep-geo New Economics Papers
on Economic Geography
Issue of 2006‒12‒09
six papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Agglomeration economies and growth-The case of Italian local labour systems, 1991-2001 By Raffaele Paci; Stefano Usai
  2. Galicia 2006: Análisis del empleo sectorial en 1980-2005 y perspectivas del desarrollo económico regional By M. Carmen Guisan
  3. Fiscal Competition and the Composition of Public Spending: Theory and Evidence By Rainald Borck; Marco Caliendo; Viktor Steiner
  4. The Babeldaob Road: The Impact of Road Construction on Rural Labor Force Outcomes in the Republic of Palau By Randall Akee
  5. Residential Mobility and Housing Adjustment of Older Households in Europe By Konstantinos Tatsiramos
  6. Checkerboards and Coase: Transactions Costs and Efficiency in Land Markets By Randall Akee

  1. By: Raffaele Paci; Stefano Usai
    Abstract: The main objective of this paper is to assess the role of a large set of factors which potentially relate agglomeration economies to local growth. Such a relationship is analysed thanks to an ample database on the case of Italy which refers to 784 Local Labour Systems and 34 sectors (21 manufacturing and 13 services) over the period 1991-2001. Econometric results show that local growth in Italy is characterized by significant differences across sectors. It is worth mentioning the positive influence of diversity externalities, human and social capital and the negative influence of specialisation externalities and competition. Spatial association is also detected.
    Keywords: Agglomeration externalities, Local growth, Spatial dependence, Italy.
    JEL: R11 R12 L60 O52
    Date: 2006
  2. By: M. Carmen Guisan
    Abstract: En este estudio presentamos un análisis de la economía gallega que es continuación del estudio Galicia2000: industria y empleo, en el que analizamos la evolución de los sectores productivos de Galicia en el período 1980-2005, con especial referencia a su impacto sobre el empleo en el período 2001-2005. Se efectúa un análisis comparativo con otras regiones españolas y europeas y se analizan los principales retos del desarrollo regional, algunos de los cuales son comunes a los retos de otras regiones periféricas de la Unión Europea. <p> This study presents an analysis of regional development in the Spanish region of Galicia, following the lines of the previous study entitles Galicia 2000: Industry and Employment. An analysis of production by sector in the period 1980-2005 is presented, with particular reference to the impact on employment during the period 2001-2005. We present a comparative analysis of this region with another Spanish and EU regions and analyze the main challenges for regional development, of which some are common to other peripheral location regions of the European Union.
    JEL: O52 R1
    Date: 2006
  3. By: Rainald Borck (University of Munich and DIW Berlin); Marco Caliendo (DIW Berlin, IAB Nuremberg and IZA Bonn); Viktor Steiner (Free University of Berlin, DIW Berlin and IZA Bonn)
    Abstract: In this paper, we consider fiscal competition between jurisdictions. Capital taxes are used to finance a public input and two public goods, one which benefits mobile skilled workers and one which benefits immobile unskilled workers. We derive the jurisdictions’ reaction functions for different spending categories. We then estimate these reaction functions using data from German communities. Thereby we explicitly allow for a spatially lagged dependent variable and a possible spatial error dependence by applying a generalized spatial two-stage least squares (GS2SLS) procedure. The results show that there is significant interaction between spending of neighbouring counties in Germany.
    Keywords: tax competition, capital skill complementarity, public spending, spatial econometrics
    JEL: H77 J24 J61
    Date: 2006–11
  4. By: Randall Akee (IZA Bonn and Harvard University)
    Abstract: This research examines the impact of road construction on rural labor force outcomes in a developing country. A new road built in the Republic of Palau links formerly inaccessible rural areas to more urban wage sector employment. We use two censuses conducted five years apart which perfectly bracket the road construction period. The data allow us to identify households that moved in the intervening five year period, thereby correcting any endogenous movement attributable to the road construction. Utilizing a difference-indifference regression strategy and matched panel data, we find that households impacted by the new road construction tend to increase their wage sector employment, decrease their self-employment in agriculture, decrease the number of international migrants sent abroad and increase their ownership of automobiles. The findings also show that inequality decreases both within and between regions. The impact of road construction on average household wages and income is negligible.
    Keywords: infrastructure, economic development, rural labor force
    JEL: O18 R29 R40
    Date: 2006–11
  5. By: Konstantinos Tatsiramos (IZA Bonn)
    Abstract: This paper investigates the determinants of residential mobility of older households (above 50 years old) and the adjustment of housing for those who move employing individual data from the European Community Household Panel. Although homeowners are less likely to move compared to renters, an increase in mobility rates is observed for older age homeowners. Moreover, having an outstanding home loan, retirement, the death of a spouse, and excessive housing costs, are significantly associated with a move in central and northern European countries, but not in the south. Analyzing the transitions from the current tenure choice after a move takes place, based on a competing risk hazard model, an increasing transition out of the current residence for old-age homeowners is found, indicating some dissaving later in life. The direction of the transitions is mostly from ownership to renting. However, especially in countries in central and northern Europe, transitions from ownership to ownership are also observed, which are associated with a reduction in the home size.
    Keywords: residential mobility, ageing, housing tenure choice, competing risk hazard
    JEL: J14 R21 R23
    Date: 2006–11
  6. By: Randall Akee (IZA Bonn and Harvard University)
    Abstract: The Coase theorem emphasizes the role transactions costs play in efficient market outcomes. We document inefficient outcomes, in the presence of a transactions cost, in southern California land markets and the corresponding transition to efficient outcomes after the transactions cost is eliminated. In the late 1800s, Palm Springs, CA was evenly divided, in a checkerboard fashion, and property rights assigned in alternating blocks to the Agua Caliente tribe and a non-Indian landowner by the US Federal government. Sales and leasing restrictions on the Agua Caliente land created a large transactions cost to development on those lands; consequently, we observe very little housing investment. Non-Indian lands provide a benchmark for efficient outcomes for the Agua Caliente lands. Once the transactions cost for Agua Caliente lands was removed, there is a convergence between American Indian-owned and non Indian-owned lands in both the number of homes constructed and the value of those homes.
    Keywords: land markets, coase theorem, economic development
    JEL: R14 O12
    Date: 2006–11

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