nep-geo New Economics Papers
on Economic Geography
Issue of 2007‒02‒17
nineteen papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Unemployment Rate Dispersion within Australian Cities By Robert Dixon
  2. Agglomeration and dispersion of economic activities in Paris and its surroundings : An exploratory spatial data analysis By GUILLAIN, Rachel; LEGALLO, Julie
  3. Unemployment Rate Dispersion in Melbourne: The Regional Dimension By Robert Dixon; Muhammad Mahmood
  4. Modeling spatial variations in household disposable income with Geographically Weighted Regression By Chasco, Coro; García, Isabel; Vicéns, José
  5. Economic Development Strategies: Examples from Europe and Australia By Petra Behrens
  6. Economic impact of port activity : a disaggregate analysis. The case of Antwerp By F. Coppens; F. Lagneaux; G. van Gastel; H. Meersman; N. Sellekaerts; E. Van de Voorde; Th. Vanelslander; A. Verhetsel
  7. Does geography matter to bondholders? By Bill Francis; Iftekhar Hasan; Maya Waisman
  8. Creativity and Industrial Cities: A Case Study of Baltimorenomenon By Zoltan J. Acs; Monika I. Megyesi
  9. New Zealand Regions, 1986-2001: Dependency and Development of Social Capital By Ian Pool; Sandra Baxendine; William Cochrane; James Lindop
  10. Globalización, Neoliberalismo Económico y Desarrollo Regional en México By Jorge Isauro Rionda Ramírez
  11. Is spatial dependence an instantaneous effect? Some evidence in economic series of Spanish provinces. By Chasco, Coro; López, Fernando
  12. L'enseignement supérieur, un élément de la dynamique des territoires. By Michel Vernières
  13. New Zealand Regions, 1986-2001: Industries and Occupations By Ian Pool; Sandra Baxendine; William Cochrane; James Lindop
  14. Explaining the Low Labor Productivity in East Germany. A Spatial Analysis By Nicola Fuchs-Schündeln; Rima Izem
  15. The Effects of Wal-Mart on Local Labor Markets By David Neumark; Junfu Zhang; Stephen Ciccarella
  16. Frühe Flexibilisierung? Regionale Mobilität nach der Lehrausbildung in Deutschland zwischen 1977 und 2004 By Seibert, Holger
  17. Using NAICS to Identify National Industry Cluster Templates for Applied Regional Analysis By Kelton, Christina M.L.; Pasquale, Margaret K.; Rebelein, Robert P.
  18. Rising Regional Inequality in China: Policy Regimes and Structural Changes By Ho, Chun-Yu; Li, Dan
  19. Regional Labor Markets, Network Externalities and Migration: The Case of German Reunification By Harald Uhlig

  1. By: Robert Dixon
    Abstract: In this paper we examine differences in the unemployment rates across regions within the five largest metropolitan areas in Australia using pooled regression analysis. We find that the level of within-city dispersion is positively correlated with the city-wide unemployment rate and that dispersion tends to be higher for females than for males. The elasticity of Absolute Dispersion with respect to the unemployment rate is close to unity implying, as we find, that Relative Dispersion is not related to the state of the labour market. We argue that this reflects the fact that there is considerable persistence of relative rates across regions within each city over time.
    Keywords: Regional Unemployment Disparities; Business Cycle; Unemployment
    JEL: E24 R11
    Date: 2007
  2. By: GUILLAIN, Rachel (LEG - CNRS UMR 5118 - Université de Bourgogne); LEGALLO, Julie (LEG - CNRS UMR 5118 - Université de Bourgogne)
    Abstract: This paper analyses the agglomeration patterns for 26 manufacturing and services sectors in Paris and its surroundings in 1999. We adopt a methodology allowing the measurement of the degree of spatial agglomeration and the identification of location patterns of economic sectors. First, we compute the locational Gini coefficient and Moran's I statistics of global spatial autocorrelation. We show that these measures provide different but complementary information about the spatial agglomeration of the sectors considered. Second, we use the tools of Exploratory Spatial Data Analysis. Moran scatterplots and LISA statistics reveal a high level of diversity in location patterns across sectors.
    Keywords: Agglomeration, Exploratory Spatial Data Analysis, Location Patterns, Spatial Autocorrelation
    Date: 2007–01
  3. By: Robert Dixon; Muhammad Mahmood
    Abstract: In this paper we examine unemployment rate dispersion across the (statistical) regions in the Melbourne metropolitan area. We find that the level of dispersion is positively correlated with the unemployment rate in all the regions taken together and that the ‘elasticity’ of dispersion with respect to the unemployment rate is unity, with the result that there is a tendency for the level of dispersion relative to the average unemployment rate to remain stationary over our sample period. We discuss the implications of this and show that the unemployment rate differences are persistent in the sense that the same areas exhibit relatively high (or low) unemployment rates over the whole of our sample period. We also estimate equilibrium rates of unemployment for the different regions in Melbourne and conjecture possible explanations for the differences in the level and in the persistence of the equilibrium rates.
    Keywords: Regional Unemployment Disparities Business Cycle Unemployment
    JEL: E24 R11
    Date: 2007
  4. By: Chasco, Coro; García, Isabel; Vicéns, José
    Abstract: The purpose of this paper is to analyze the spatially varying impacts of some classical regressors on per capita household income in Spanish provinces. The authors model this distribution following both a traditional global regression and a local analysis with Geographically Weighted Regression (GWR). Several specifications are compared, being the adaptive bisquare weighting function the more efficient in terms of goodness-of-fit. We test for global and local spatial instability using some F-tests and other statistical measures. We find some evidence of spatial instability in the distribution of this variable in relation to some explanatory variables, which cannot be totally solved by spatial dependence specifications. GWR has revealed as a better specification to model per capita household income. It highlights some facets of the relationship completely hidden in the global results and forces us to ask about questions we would otherwise not have asked. Moreover, the application of GWR can also be of help to further exercises of micro-data spatial prediction.
    Keywords: Geographically Weighted Regression (GWR); spatial non-stationarity; spatial prediction; income; Spanish provinces
    JEL: R12 C21
    Date: 2007–01–24
  5. By: Petra Behrens (School of Economics and Finance, Queensland University of Technology)
    Abstract: By looking at very different aspects of regional economic development theory and policy as well as geographical areas, this paper provides a foundation of economic strategies applicable to many regions. The focus is set on a flexible and holistic approach to be able to include a wide range of economic development and wellbeing indictor and to offer an alternative to the neoclassical development framework. The European regional policy is used as an example to analyse policy in a theoretical economic development framework. The Australian example is a practical case study of a small rural shire showing the issues individual regions are facing when they are dealing with regional development on a local level.
  6. By: F. Coppens (NBB, Microeconomic Information Department); F. Lagneaux (NBB, Microeconomic Information Department); G. van Gastel (NBB, Microeconomic Information Department); H. Meersman (University of Antwerp (UA), Department of Transport and Regional Economics); N. Sellekaerts (University of Antwerp (UA), Department of Transport and Regional Economics); E. Van de Voorde (University of Antwerp (UA), Department of Transport and Regional Economics); Th. Vanelslander (University of Antwerp (UA), Department of Transport and Regional Economics); A. Verhetsel (University of Antwerp (UA), Department of Transport and Regional Economics)
    Abstract: The economic impact of the port sector is usually measured at an aggregate level by indicators such as value added, employment and investment. This paper tries to define the economic relevance for the regional as well as for the national economy at a disaggregate level. It attempts to identify, quantify and locate the mutual relationships between the various port players themselves and between them and other Belgian industries. Due to a lack of information foreign trade is only tackled very briefly but the method outlined in this paper can be used to measure the national effects of changes in port activity at a detailed level. A sector analysis is made by compiling a regional (regional as geographically opposed to national, not to be mistaken for the Belgian Regions Brussels, Flanders and Wallonia) input-output table, resorting to microeconomic data: a bottom-up approach. The main customers and suppliers of the port's key players or stakeholders are identified. A geographical analysis can also be carried out by using data at a disaggregate level. Each customer or supplier can be located by means of their postcode. In so doing, the economic impact of the port is quantified, both functionally and geographically. In the case of the port of Antwerp, the results show important links between freight forwarders and agents. The geographical analysis suggests the existence of major agglomerating effects in and around the port of Antwerp, referred to as a major transhipment location point. Key words: port economics, regional input-output table, sector analysis, geographical analysis.
    Keywords: port economics, regional input-output table, sector analysis, geographical analysis
    JEL: C67 L90 R12 R15 R41
    Date: 2007–02
  7. By: Bill Francis; Iftekhar Hasan; Maya Waisman
    Abstract: We find that the location of corporate headquarters significantly affects the firm’s bondholders. Similar to Loughran and Schultz (2006) and others, who show that investors are better able to obtain information on nearby companies, we look at firms located in large metropolitan cities, small cities, and rural areas and find that firms located in remote rural areas exhibit significantly higher costs of debt capital (of up to 65 basis points) in comparison to their urban counterparts. Unlike other studies that focus on the role of information asymmetries in the local bias of investors and decision makers, we are able to show that firms in remote areas experience greater costs of debt capital primarily because of a greater difficulty of monitoring their activities. We find that the adverse impact of bad corporate governance on bondholders is magnified in geographically remote firms, primarily because geographic distance reduces the effectiveness of external monitoring. Consistent with that, we show that in the private placement market, where firms are closely monitored by institutional investors, location plays no role in explaining the cross-sectional variation in the cost of debt capital across companies. We also find that the passage of the 2002 Sarbanes-Oxley Act, which brought about regulatory improvements in monitoring and governance, significantly reduced the agency costs of debt in rural firms. Taken together, our results indicate that the firm’s information environment interacts with the impact of corporate governance, particularly affecting the effectiveness of external monitoring in alleviating agency problems between insiders and debt holders.
    Date: 2007
  8. By: Zoltan J. Acs; Monika I. Megyesi
    Abstract: Creativity is changing the way cities approach economic development and formulate policy. Creative metropolises base their economic development strategies, at least partly, on building communities attractive to the creative class worker. While there are countless examples of high-tech regions transforming into creative economies, traditionally industrial cities have received much less attention in this regard. This research draws on Baltimore to assess the potential of transforming a traditionally industrial region into a creative economy. It analyses Baltimore’s performance on dimensions of talent, tolerance, technology, and territory both as a stand-alone metropolitan area and in comparison to similar industrial metropolises. Using data from the US Census Bureau and research on creativity measures, this case study concludes that Baltimore has the opportunity to capitalize on the creative economy because of its openness to diversity, established technology base, and appealing territorial amenities. An important consideration in the transformation towards a creative economy is Baltimore's geographic proximity and access to the largest reservoir of creative talent in the US: Washington, DC.
    Keywords: creativity, creative class, creativity index, creative cities, talent, technology, tolerance, territory, bohemian index, gay index, old industrial cities, Baltimore, economic development, economic growth, entrepreneurship
    Date: 2007–02
  9. By: Ian Pool (University of Waikato); Sandra Baxendine (Waikato District Health Board); William Cochrane (University of Waikato); James Lindop (University of Waikato)
    Abstract: The development of social capital is significantly affected by benefit dependency of the population. This paper investigates measures of social cohesion and measures of dependency on society across the regions of New Zealand. Some of the measures looked at specifically are social security benefit use and convictions, custodial sentences and the prison muster across regions. The paper also focuses on housing and specifically considers overcrowding.
    Keywords: Benefits, Overcrowding, Convictions, Regions, New Zealand
    JEL: I38 K42 R21 R23
    Date: 2006–03–05
  10. By: Jorge Isauro Rionda Ramírez
    Abstract: The processes of economic integration respond to the logic of the regime of flexible production implemented to world-wide level. Its effect in the local economies is in its economic opening and treaties of cooperation. Its effect at regional level acquires some matizaciones of general type, that without denying the singularities of the processes of integration of each region, are common characteristics of the globalización process. The work tries to mainly delineate the common characteristics and their regional, local expressions and, in the city that entails the implementation of the new regime of flexible production, as much for Ibero-America, but in special of Mexico.
    Keywords: Desarrollo regional, Régimen de producción flexible, Neoliberalismo, Globalización, Integración económica, Ciudad
  11. By: Chasco, Coro; López, Fernando
    Abstract: The purpose of this article is to analyze if spatial dependence is a synchronic effect, as it has usually been defined. It is known that in many socio-economic phenomena spatial dependence can be not only contemporary but also time-lagged. In this paper, we use two Moran-based space-time autocorrelation statistics in order to evaluate the simultaneity of this spatial effect, allowing for mixed specifications with instantaneous and space-time dependence terms. Some applications with economic data for Spanish provinces shed some light upon these issues.
    Keywords: Space-time dependence; Spatial autoregressive models; Moran’s I; Spanish provinces.
    JEL: C21 C15 C51
    Date: 2006–12–13
  12. By: Michel Vernières (Centre d'Economie de la Sorbonne)
    Abstract: Higher education establishments have a very important role for local development, especially for medium-sized towns. Universities are at the origin of jobs, and income, therefore they play a role for local development. In the last decades, local authorities have found it logical to relocate universities in France. But, for the future, this effort to attract new university programmes will probably oppose overall national policy. Of course, in a national and international context of competition, the most powerful universities have a true comparative advantage.
    Keywords: France, higher education, local development, regional planning, relocation.
    JEL: I23 R58
    Date: 2006–12
  13. By: Ian Pool (University of Waikato); Sandra Baxendine (Waikato District Health Board); William Cochrane (University of Waikato); James Lindop (University of Waikato)
    Abstract: This paper provides an analysis which examines the differences in the industrial and occupational structure of New Zealand regions. Using data compiled by Statistics New Zealand from Goods and Services Tax (GST) registrations supplied by the Inland Revenue Department, it also looks at business size trends. The analysis in this paper points to a distinct change in the characteristics of the New Zealand labour force, a shift to a “More Highly Skilled Tertiary” sector. This paper shows that these changes did not occur uniformly across New Zealand regions. Instead, skills typical of the “new economy” or the “knowledge society” are concentrated in Auckland and Wellington, and to a lesser degree Canterbury. This trend has seen regional patterns of work diverge more and more.
    Keywords: Industry, Occupation, Regions, New Zealand
    JEL: J21 J24 L16 R23
    Date: 2005–12–16
  14. By: Nicola Fuchs-Schündeln; Rima Izem
    Abstract: This paper presents a spatial analysis of unemployment rates in Germany. The goal of this analysis is to explain the stubbornly low labor productivity and high unemployment rates in Eastern Germany. We build a model of commuting to distinguish between worker and job characteristics as the main causes of the low labor productivity, and use the method of simulated moments to estimate the East-West ratios of worker and job characteristics. The “slope” of the unemployment rate across the former East-West border serves as the main identification of the model. The preliminary results suggest that East and West German skills are very similar, while job characteristics differ significantly between East and West.
    Keywords: Transferability of Human Capital, Spatial Allocation of Labor
    JEL: C15 J24 J61
    Date: 2007–01
  15. By: David Neumark (University of California, Irvine, Public Policy Institute of California, NBER and IZA); Junfu Zhang (Clark University); Stephen Ciccarella (Cornell University)
    Abstract: We estimate the effects of Wal-Mart stores on county-level retail employment and earnings, accounting for endogeneity of the location and timing of Wal-Mart openings that most likely biases the evidence against finding adverse effects of Wal-Mart stores. We address the endogeneity problem using a natural instrumental variables approach that arises from the geographic and time pattern of the opening of Wal-Mart stores, which slowly spread out from the first stores in Arkansas. The employment results indicate that a Wal-Mart store opening reduces county-level retail employment by about 150 workers, implying that each Wal-Mart worker replaces approximately 1.4 retail workers. This represents a 2.7 percent reduction in average retail employment. The payroll results indicate that Wal-Mart store openings lead to declines in county-level retail earnings of about $1.2 million, or 1.3 percent. Of course, these effects occurred against a backdrop of rising retail employment, and only imply lower retail employment growth than would have occurred absent the effects of Wal-Mart.
    Keywords: Wal-Mart, location, employment
    JEL: J21 R12
    Date: 2007–01
  16. By: Seibert, Holger (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "This paper examines if and to what extend regional mobility has increased after finishing vocational in-firm training between 1977 and 2004. Particular interest is given to the importance of regional mobility for occupational continuity at labor market entry. Can mobility lower the probability of occupational shifts so that human capital investments are not written off early? Can regional mobility in this sense be used as a strategy to optimize labor market opportunities and has it become more important over time? Analyses show that regional mobility can indeed be used strategically to find jobs in the occupation trained for. Its importance, however, is limited and has not changed over time significantly. Nevertheless, mobility improves the fit between actual occupation and the one trained for." (author's abstract, IAB-Doku) ((en))
    Keywords: regionale Mobilität, Berufsausbildung, Ausbildungsabsolventen, Berufseinmündung, Berufswechsel, Arbeitsmarktchancen, Ausbildungsberufe
    JEL: J62
    Date: 2007–02–10
  17. By: Kelton, Christina M.L. (College of Business, University of Cincinnati); Pasquale, Margaret K. (P & G Pharmaceuticals, Inc.); Rebelein, Robert P. (Vassar College Department of Economics)
    Abstract: Whereas FESER and BERGMAN, 2000, developed the concept of national-level cluster templates and introduced a systematic methodology to identify such clusters, their technique and results were based on the now-outdated Standard Industrial Classification (SIC) system for categorizing industries. We update their results using the 1997 Benchmark Input-Output Accounts for the United States, which are based on the North American Industry Classification System (NAICS). Since the treatment of services is much more comprehensive under NAICS, we are able to expand on the Feser and Bergman manufacturing templates to identify more comprehensive mixed-sector templates. The cluster templates we determine can provide a foundation for regional economic development strategies.
  18. By: Ho, Chun-Yu; Li, Dan
    Abstract: Regional inequality is severe in China since regional development is uneven due to various initial conditions and government policies. We employ unit root tests allowing for structural breaks to alternative inequality measures from 1952 to 2000. Empirical results indicate that (1) the regional inequality is trend stationary with structural breaks rather than follow a random walk. Thus, ignoring structural changes might induce incorrect inference and misleading policy implications; (2) the break points are associated with episodic events in Chinese economic history such as the Cultural Revolution and market reforms. It implies that the policies had a long-lasting and fundamental effect on the inequality.
    Keywords: Structural break; unit root; inequality; China
    JEL: R58 O15 C22
    Date: 2007–02–13
  19. By: Harald Uhlig
    Abstract: This paper analyzes the cost of disinflation under real wage rigidities in a micro-founded New Keynesian model. Unlike Blanchard and Galí (2007) who carried out a similar analysis in a linearized framework, we take non-linearities into account. We show that the results change dramatically, both qualitatively and quantitatively, for the steady states and for the dynamic adjustment paths. In particular, a disinflation implies a prolonged slump without any need for real wage rigidities.
    Keywords: Disinflation, Sticky Prices, Real Rigidities
    JEL: E31 E52
    Date: 2007–02

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