nep-geo New Economics Papers
on Economic Geography
Issue of 2010‒10‒02
twenty papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Statistical evaluation of spatial concentration of unemployment by gender By Jaba, Elisabeta; Balan, Christiana; Roman, Mihai; Roman, Monica
  2. Cities and clusters: economy-wide and sector-specific effects in corporate location By Giulio Bottazzi; Ugo Gragnolati
  3. Competitiveness, Clusters and Policy at the Regional Level: Rhetoric vs. Practice in Designing Policy for Depressed Regions By Argentino Pessoa
  4. Access to Workers or Employers? An Intra-Urban Analysis of Plant Location Decisions By Mark J. Kutzbach
  5. Path Dependence, Institutions and the Density of Economic Activities: Evidence from Italian Cities By Marco Percoco
  6. Enviromental Performance and Regional Innovation Spillovers By Valeria Costantini; Massimiliano Mazzanti; Anna Montini
  7. The Determinants of Agglomeration in Health Care Sector Employment in US Metropolitan areas By Mishra, Bhawani P.
  8. Spillovers in Space: Does Geography Matter? By Sergey Lychagin; Joris Pinkse; Margaret E. Slade; John Van Reenen
  9. Proximity is a Social Process - A Conceptual Framework. By Anja Dettmann; Thomas Brenner
  10. Spatial Chow-Lin Methods for Data Completion in Econometric Flow Models By Polasek, Wolfgang; Sellner, Richard
  11. Regional Inflation (Price) Behaviors: Heterogeneity and Convergence By Nagayasu, Jun
  12. Internal Migration Across Italian regions: Macroeconomic Determinants and Accommodating Potential for a Dualistic Economy By Romano Piras
  13. Performance Measurement at the Sub-national Government Level in Croatia By Dubravka Jurlina Alibegovic; Suncana Slijepcevic
  14. Does Fiscal Decentralization Constrain Leviathan? Evidence from Local Property Tax Competition By George R. Crowley; Russell S. Sobel
  15. The Effect of Easing Monetary Policy in Regional Lending Markets in Japan By Nagano, Mamoru
  16. Trade and regional inequality By Andrés Rodríguez-Pose
  17. Limitações teóricas da literatura convencional sobre impactos regionais de política monetária By Fernanda Faria Silva; Marco Aurélio Crocco Afonso; Carlos Javier Rodríguez-Fuentes
  18. Spatial Stochastic Frontier Models By Barrios, Erniel B.; Lavado, Rouselle F.
  19. Does Urban Proximity Enhance Agricultural Productivity in China? By Chloe DUVIVIER
  20. Social Responsibility as a Driver for Local Sustainable Development By Elena Costantino; Maria Paola Marchello; Cecilia Mezzano

  1. By: Jaba, Elisabeta; Balan, Christiana; Roman, Mihai; Roman, Monica
    Abstract: This paper studies the spatial distribution of unemployment by gender, in the counties of Romania, in 2008.The Lorenz curve and Gini index are used to identify a pattern of spatial concentration of unemployment, differentiated by gender. Evaluation of gender differences in unemployment spatial concentration model shows significant differences. There is a greater spatial concentration of unemployment for female population. Based on results of grouping counties by cluster analysis applied for unemployment rate, one could explain the gender differences in spatial concentration correlated with spatial distribution of the workforce and the characteristics of territorial development of counties in Romania.
    Keywords: unemployment; spatial concentration; gender discrepancies; cluster analysis; regional development; Romania
    JEL: E24 J21 R11
    Date: 2010–01
  2. By: Giulio Bottazzi; Ugo Gragnolati
    Abstract: Are the observed spatial distributions of firms decided mostly by market-mediated, economy-wide locational forces, or rather by non-pecuniary, sector-specific ones? This work finds that the latter kind of forces weight systematically more than the former in deciding firm location. The analysis uses Italian data on a variety of manufacturing and service sectors spatially disaggregated at the level of Local Labor Systems.
    Keywords: Industrial Location, Sector-specific Agglomeration, Urbanization Economy, Maximum Likelihood Estimation
    JEL: L1 C31 R3
    Date: 2010–09–16
  3. By: Argentino Pessoa (CEF.UP, Faculdade de Economia, Universidade do Porto)
    Abstract: This paper reviews the most important theoretical foundations of the spatial competitiveness conception, dealing with three levels of competitiveness: the country, the region and the tourism destination. Consequently, it draws attention to the main aspects that such concepts of competitiveness must include and it links the regional competitiveness with the related concept of cluster. Therefore, section 2 reviews the key aspects of competitiveness at the first level highlighting the role of the main forces acting at the national level. Section 3 extends the concept to the regional level, highlighting the critical aspects that must be considered when policy tries to increase the competitiveness of a particular region. Section 4 analyses the possibilities of extending the competitiveness concept to tourism destinations. Next, the paper analyses the literature on policy advice and discuss the inconsistency between the theory and the policy designed to promote regional competitiveness. Finally, the paper presents some concluding remarks on regional policy applied to depressed regions.
    Keywords: clusters, competitiveness, regional policy, tourism
    JEL: Q25 Q28 R19 R58
    Date: 2010–09
  4. By: Mark J. Kutzbach
    Abstract: This analysis attributes economies of agglomeration to either labor market pooling or employer-based productivity spillovers by distinguishing the effect of access to workers, measured by place-of-residence, from the effect of access to employers. New establishment location choices serve as a measure of productivity advantages, while census tract level data on access to same-industry employment, other-industry employment, and specialized workers, as well as metropolitan area fixed effects, measure sources of agglomeration and other locational characteristics. The four industries included are selected so that each relies on a workforce with a specialized occupation that is identifiable by place-of-residence, and that productivity and cost advantages are the primary drivers of location choice. The results show that both access to specialized workers and access to same-industry employers contribute to economies of agglomeration at an intra-urban spatial scale, and that the magnitude of the worker effect is large relative to employer-based productivity spillovers.
    Keywords: Economies of Agglomeration; Labor Market Pooling; Commuting
    Date: 2010–09
  5. By: Marco Percoco (Department of Institutional Analysis and Public Management and CERTeT Bocconi University)
    Abstract: In recent years a growing body of literature has begun to consider the possible presence of path dependence in the development processes of countries. This phenomenon has always been recognized in regional and urban studies because the path of development almost naturally follows a history-dependent spatial diffusion influenced by both physical geography and the quality of institutions. In this paper, I consider the case of firm concentration in Italy and its impact on local development. A large and growing literature has argued in favour of persisting effects of past institutions on current outcomes. Hence, in order to identify the impact of firm density on income, I use instruments from the history of a set of Italian cities: namely the presence of a university and status as a free-city state in the Early Middle Ages. I first show that those two variables had an important effect on the process of urban development between 1300 and 1861, together with favourable geographic conditions. Then, when I use these instruments to predict firm density, I find that the elasticity of income to firm density is close to 0.1. This result is interpreted as providing evidence of the historical roots of agglomeration economies in Italy.
    Keywords: Path dependence, Urban development, Geography, Institutions, Firm density
    JEL: O18 R12
    Date: 2010–09
  6. By: Valeria Costantini (University of Roma III); Massimiliano Mazzanti (University of Ferrara, University of Bologna and CERIS-CNR); Anna Montini (University of Bologna)
    Abstract: The achievement of positive environmental performance at national level could strongly depend on differences in local capabilities of both institutions and the private business sector. Environmental regulation alone is a weak instrument if the institutional and business environment cannot transform regulation strengths into opportunities. In this paper, we use the new environmental accounting matrix for polluting emissions now available for the 20 Italian Regions that covers 24 sectors and combines a shift-share approach with spatial econometric modelling. We provide evidence of the role played by internal innovation, innovation spillovers and regional policies in shaping the geographical distribution of environmental performance achievements.
    Keywords: Environmental Performance, Technological Innovation, Regional Spillovers, Polluting Emissions, Italian Regions
    JEL: Q53 Q55 Q56 R15
    Date: 2010–09
  7. By: Mishra, Bhawani P.
    Abstract: Paper Presented on 41st Annual and Conference Mid-Continent Regional Science Association (MCRSA), June 3-5, 2010 St. Louis, MO
    Keywords: agglomeration, panel data, Metropolitan area., Community/Rural/Urban Development,
    Date: 2010–06–05
  8. By: Sergey Lychagin; Joris Pinkse; Margaret E. Slade; John Van Reenen
    Abstract: We simultaneously assess the contributions to productivity of three sources of research anddevelopment spillovers: geographic, technology and product- market proximity. To do this,we construct a new measure of geographic proximity that is based on the distribution of afirm's inventor locations rather than its headquarters, and we report both parametric andsemiparametric estimates of our geographic-distance functions. We find that: i) Geographicspace matters even after conditioning on horizontal and technological spillovers; ii)Technological proximity matters; iii) Product-market proximity is less important; iv)Locations of researchers are more important than headquarters but both have explanatorypower; and v) Geographic markets are very local.
    Keywords: geographic proximity, R&D spillovers, semiparametric and technological proximity
    JEL: C23 L60 O33
    Date: 2010–08
  9. By: Anja Dettmann (Department of Geography, Philipps University Marburg); Thomas Brenner (Department of Geography, Philipps University Marburg)
    Abstract: Spatial proximity is assumed in the literature to be a prerequisite and trigger for cooperation and, subsequently, innovation. This paper examines conceptually the role of proximity between actors for cooperation activities. Using theories and findings from social psychology and combining them with geographical issues, it provides new insights into the emergence and development of professional collaborative relationships and the role that spatial proximity plays. Thereby the paper stays on the level of individuals (micro-level) and explains how the willingness to collaborate emerges and how local partner priorities are developed.
    Keywords: Collaboration, Partner Choice, Proximity, Innovation, Geography
    JEL: L14 O32 R10
    Date: 2010–09
  10. By: Polasek, Wolfgang (Department of Economics and Finance, Institute for Advanced Studies, Vienna, Austria, and Faculty of Science, University of Porto, Porto, Portugal); Sellner, Richard (Department of Economics and Finance, Institute for Advanced Studies, Vienna, Austria)
    Abstract: Flow data across regions can be modeled by spatial econometric models, see LeSage and Pace (2009). Recently, regional studies became interested in the aggregation and disaggregation of flow models, because trade data cannot be obtained at a disaggregated level but data are published on an aggregate level. Furthermore, missing data in disaggregated flow models occur quite often since detailed measurements are often not possible at all observation points in time and space. In this paper we develop classical and Bayesian methods to complete flow data. The Chow and Lin (1971) method was developed for completing disaggregated incomplete time series data. We will extend this method in a general framework to spatially correlated flow data using the cross-sectional Chow-Lin method of Polasek et al. (2009). The missing disaggregated data can be obtained either by feasible GLS prediction or by a Bayesian (posterior) predictive density.
    Keywords: Missing values in spatial econometrics, MCMC, non-spatial Chow-Lin (CL) and spatial Chow-Lin (SCL) methods, spatial internal flow (SIF) models, origin and destination (OD) data
    JEL: C11 C15 C52 E17 R12
    Date: 2010–09
  11. By: Nagayasu, Jun
    Abstract: It is generally thought that members in monetary union experience a similar level of inflation. This paper verifies this conventional belief. Using regional data, we present statistical evidence of heterogeneous inflation in Japan. Not only does the average inflation differ significantly across regions, but regional inflation responds differently to common economic and monetary factors. Furthermore, we show no evidence of price convergence in a group of entire regions although there is some evidence of convergence in subgroups. These results suggest that diversified regional inflation can exist within monetary union.
    Keywords: Regional inflation; monetary policy; factor models; convergence
    JEL: F3 E3
    Date: 2010–09
  12. By: Romano Piras (University of Cagliari)
    Abstract: We provide econometric evidence that relative per capita GDP and relative unemployment rates are the main determinants of migration flows across Italian regions from 1970 to 2002. The empirical analysis is based on an accurate study of the dynamic properties of the series. In fact, we deal with the issues of non-stationarity and cointegration and estimate an error correction model in which both the short- and long-run dynamics are modelled at once. The regional unemployment rate is robustly inversely related with net regional migration rate, while per capita GDP is strongly positively linked with it. As far as the accommodating potential of internal migration to regional unbalances, we have detected very little room for such a role. Indeed, the degree of labour mobility across Italian regions cannot be active as an effective equilibrating mechanism.
    Keywords: Italy, Labour Migration, Internal Migration, Income Differences, Panel Cointegration
    JEL: C23 J61 R23
    Date: 2010–09
  13. By: Dubravka Jurlina Alibegovic (The Institute of Economics, Zagreb); Suncana Slijepcevic (The Institute of Economics, Zagreb)
    Abstract: This paper analyzes the role of performance measurement at the sub-national government level in Croatia as one of the crucial factors that lead to the improvement of implementation of local and regional policies. The analysis is based on the Public Expenditure and Financial Accountability Public Financial Management (PEFA PFM) Performance Measurement Framework. Three performance indicators are used for measuring the credibility of the sub-national budget. The first performance indicator measures the differences between aggregate expenditure outturns and the original approved budget at the sub-national government level in Croatia. The second performance indicator is used to examine the difference between the composition of expenditure outturn and the original approved budget at the sub-national government level in Croatia. The third indicator measures the deviation of aggregate revenue outturn from the original approved budget at the sub-national government level in Croatia. A significant divergence of budgetary outturns from the original approved budget, both on the revenue and expenditure side of the budget, confirms the hypothesis about low credibility of the budget at the sub-national level in Croatia. The paper also analyzes the impact of expenditure structure on the performance of the sub-national government level in Croatia. The results presented in this paper identify the main policies which the sub-national government uses to encourage local and regional development in Croatia. However, the results show that the budget does not incorporate any aspects of strategic planning, which is necessary to achieve local and regional development. The substantial difference between planned and realized budgetary expenditures is a key obstacle to faster local and regional development.
    Keywords: local and regional development, local and regional policy, performance measurement, Croatia
    JEL: R51
    Date: 2010–09
  14. By: George R. Crowley (Department of Economics, West Virginia University); Russell S. Sobel (Department of Economics, West Virginia University)
    Abstract: This paper reexamines whether fiscal decentralization constrains Leviathan government. Using panel data for Pennsylvania, we compare actual property tax rates to the Leviathan revenue-maximizing rates for municipalities, school districts, and counties. Using spatial econometric methods we also estimate the degree of spatial dependence at the three levels of local government. We find that fiscal decentralization results in stronger intergovernmental competition and lower tax rates. We also find evidence of collusion among school districts that exhibit high interdependence but also high tax rates. This calls into question the current literature's blind use of spatial dependence as a measure of intergovernmental competition.
    Keywords: Fiscal decentralization, Leviathan, Tax competition
    JEL: H77 H73
    Date: 2010
  15. By: Nagano, Mamoru
    Abstract: This paper investigates the factors that support a funding demand increase in regional economies under easing monetary conditions. The following results were empirically obtained on the basis of individual firms and the 47 regional data in the 2000s in Japan. The first result is that funding demand regionally increases where the relative size of private capital stock is large. This result suggests that industrial agglomeration complements easing monetary policy to induce regional funding demand. The second result is that regional banking soundness in lending markets also contributes to an increase in the funding demand. This suggests that another possible requirement of the money suppliers must be fulfilled to induce the regional funding demand.
    Keywords: Regional Policy; Regional Banking Market; Monetary Policy
    JEL: R13 R11 G21
    Date: 2010–02
  16. By: Andrés Rodríguez-Pose (IMDEA Ciencias Sociales)
    Abstract: This paper examines the relationship between openness and within-country regional inequality across 28 countries over the period 1975-2005, paying special attention to whether increases in global trade affect the developed and developing world differently. Using a combination of static and dynamic panel data analysis, it is found that while increases in trade per se do not lead to greater territorial polarisation, in combination with certain country-specific conditions, trade has a positive and significant association with regional inequality. In particular, states with higher interregional differences in sectoral endowments, a lower share of government expenditure, and a combination of high internal transaction costs with a higher degree of coincidence between the regional income distribution and regional foreign market access positions have experienced the greatest rise in territorial inequality when exposed to greater trade flows. This means that changes in trade regimes have had a more polarising effect in low and middle income countries, whose structural features tend to potentiate the trade effect and whose levels of internal spatial inequality are, on average, significantly higher than in high income countries.
    Keywords: trade; regional inequalit; low and medium income countries
    JEL: F11 O18 R12 R58
    Date: 2010–06–25
  17. By: Fernanda Faria Silva (Cedeplar-UFMG); Marco Aurélio Crocco Afonso (Cedeplar-UFMG); Carlos Javier Rodríguez-Fuentes (Universidad de La Laguna – Spain)
    Abstract: The aim of this paper is to analyze the theoretical limitations of the mainstream’s Works related to the regional impacts of monetary policy. After a general presentation of the conventional framework, followed by the typology proposed in Dow & Rodríguez-Fuentes (1997), we present our arguments based on the Post-Keynesian theory against the traditional approach. In our view, the Post-Keynesian framework is the most appropriate for analyzing this type of dynamics. Its theoretical elements have the best explanation for the dynamics of the monetary policy at a regional level, once they take into account the role played by uncertainty and liquidity preference of economic agents and institutions, which are essential for the understanding the regional economics in a "center – periphery” context.
    Keywords: regional monetary policy, liquidity preference, Post-Keynesian theory.
    JEL: B59 E51 E52 E59 O23
    Date: 2010–01
  18. By: Barrios, Erniel B.; Lavado, Rouselle F.
    Abstract: The stochastic frontier model with heterogeneous technical efficiency explained by exogenous variables is augmented with a sparse spatial autoregressive component for a cross-section data, and a spatial-temporal component for a panel data. An estimation procedure that takes advantage of the additivity of the model is proposed, computational advantages over simultaneous maximum likelihood estimation of all parameters is exhibited. The technical efficiency estimates are comparable to existing models and estimation procedures based on maximum likelihood methods. A spatial or spatial-temporal component can improve estimates of technical efficiency in a production frontier that is usually biased downwards.
    Keywords: technical efficiency, stochastic frontier model, Philippines, spatial externalities, spatial-temporal model, backfitting
    Date: 2010
  19. By: Chloe DUVIVIER
    Abstract: We study whether rural areas close to urban centers enjoy a more productive agricultural sector than remote ones. We try to answer three questions: (1) Do rural areas close to urban centers and remote areas share the same agricultural technology? (2) Are rural areas close to urban center technically more efficient? (3) Do they enjoy a faster technical progress? The empirical examination is realized at the county level on a sample covering three provinces of the south-east of China from 2002 to 2007. Several interesting results are obtained. On the one hand, the type of agricultural technology adopted varies with the distance between the rural area and the urban center. On the other hand, urban proximity has a positive effect on agricultural productivity. Finally, our results confirm a previous finding: the most important component of total factor productivity growth in China is technical progress, whereas technical efficiency decreases it.
    Keywords: Agricultural productivity, urban proximity, latent class stochastic frontier model, technical change.
    JEL: R11 Q10 O18 O13
    Date: 2010
  20. By: Elena Costantino (Fondazione Eni Enrico Mattei); Maria Paola Marchello (Fondazione Eni Enrico Mattei); Cecilia Mezzano (Fondazione Eni Enrico Mattei)
    Abstract: The increased interconnection among local and global players induced by globalization, as well as the need for a complete application of the “subsidiarity principle”, calls for a re-thinking of the “corporate social responsibility” concept. This new concept broadens the perspective of the single company interacting with its own stakeholders in relation to specific social and environmental impacts, to a network of organizations, with different aims and natures, collaborating on relevant sustainability issues. In this paper, the authors will provide a definition of “Territorial Social Responsibility”, sustaining the multi-stakeholder approach as a driver toward local sustainable development. Firstly, theoretical approaches to sustainable development at the territorial level will be examined, identifying the most innovative ideas about governance, network relation and development theories. The idea of development focuses not only on the economic aspects, but on the structural and institutional factors. The existence of cooperative territorial networks is essential to fulfil the creation of tangible and intangible assets at the local level. At the same time, the effectiveness of the decision-making and rules’ system can stimulate and empower territorial networks to tackle sustainable development. An analytical framework, scheme-shaped, will be set in order to identify the main aspects, indicators and practices characterizing the territorial social responsibility concept. It will represent a first attempt to create a feasible instrument aimed at understanding how cooperative social responsible actors, operating in the same territory, could direct the path toward sustainable development.
    Keywords: Local Sustainable Development, Territorial Social Responsibility, Participation, Local Governance, Accountability, Sustainability Reporting, Multi-Stakeholder Approach, Networks
    JEL: M14 O10
    Date: 2010–09

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