nep-geo New Economics Papers
on Economic Geography
Issue of 2010‒10‒09
fifteen papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Managing Housing Bubbles in Regional Economies Under EMU: Ireland and Spain By Conefrey, Thomas; Fitz Gerald, John
  2. Policy making in asymmetric regional integrations: a methodology for allocating cohesion fund resources By Calfat, G.; Flôres, R.G.; Rivas, A.; Granato, M.
  3. Do Clusters Really Matter for Innovation Practices in Information Technology? Questioning the Significance of Technological Knowledge Spillovers By Franz Huber
  4. Economic Effects of Clustering of Ethnically Similar Communities in Kenya: Application of Spatial Correlation Model By Nobuaki Hamaguchi
  5. Measures of poverty and inequality in the countries and regions of EU By Nicholas T. Longford; Maria Grazia Pittau; Roberto Zelli; Riccardo Massari
  6. Series anuales de algunos agregados económicos y demográficos regionales, 1955-2009 (RegDat versión 2.3) By Angel de la Fuente
  7. On the failure of European planning for less developed regions. The case of Calabria By Forte, Francesco; Magazzino, Cosimo; Mantovani, Michela
  8. Entrepreneurial Finance and the Flat-World Hypothesis: Evidence from Crowd-Funding Entrepreneurs in the Arts By Ajay Agrawal; Christian Catalini; Avi Goldfarb
  9. Phases of Imitation and Innovation in a North-South Endogenous Growth Model By Miguel Atienza; Marcelo Lufin
  10. A Review of Local Economic and Employment Development Policy Approaches in OECD Countries: Executive Summary and Synthesis of Findings By Jonathan Potter; Marco Marchese
  11. Spatial discrimination, nations' size and transportation costs By Kai Andree
  12. La capacité d'achat immobilier en Ile-de-France : Evaluation dynamique et disparités géographiques. By Beaubrun-Diant, Kevin
  13. The Impact of Connectivity on Market Interlinkages; Evidence from Rural Punjab By Mahvish Shami
  14. Understanding Neighbourhood Effects: Selection Bias and Residential Mobility By Bergström, Lina; van Ham, Maarten
  15. Análisis del potencial socioeconómico de municipios rurales con métodos no paramétricos: aplicación al caso de una zona Leader By Reig Martínez Ernest

  1. By: Conefrey, Thomas; Fitz Gerald, John
    Keywords: emu/Ireland
    Date: 2010–07
  2. By: Calfat, G.; Flôres, R.G.; Rivas, A.; Granato, M.
    Abstract: We propose a combination of region- and product-identification procedures in order to map the potential of economic activities in areas with poor infrastructure in an asymmetric regional integration. After identifying spatial units with relative backwardness in terms of infrastructure, we detect the most competitive exports, estimate gravity models for each of them and perform simulations for an improvement of 20% in the value of the infrastructure index. In a final step, we identify goods/provinces where investment in infrastructure should be directed to. A thorough and data intensive application is made to the case of the Fondo de Convergencia Estructural del MERCOSUR (FOCEM), the recently created cohesion fund of one of the most asymmetric integration projects. Our main conclusion is that FOCEM resources, under the global objective of enhancing structural convergence among the members, should be totally directed to Paraguay instead of being dispersed among all backward regions in the bloc.
    Date: 2010–03
  3. By: Franz Huber
    Abstract: A widespread assumption in economic geography and the economics of innovation is that firms located in clusters benefit from territorial learning and knowledge spillovers. However, it remains unclear to what extent these benefits actually occur. This paper aims to address this issue and examines to what extent research and development (R&D) workers in the Cambridge Information Technology (IT) Cluster benefit from being located in the Cluster. The study shows why many do not believe that their work benefits from being located in the Cluster. The results suggest that academics as well as policy makers need to be more careful with the assumption of technological knowledge spillovers in innovative clusters. The significant advantages of the Cambridge IT Cluster seem to be of a different nature; in particular they concern labour market advantages and benefits from the global ‘brand’ of Cambridge.
    Keywords: Clusters; Knowledge Spillovers; Territorial Learning; Agglomeration Economies
    JEL: D83 O18 R11
    Date: 2010
  4. By: Nobuaki Hamaguchi (Research Institute for Economics and Business Administration, Kobe University)
    Abstract: Using regional data of Kenya, we found that income spillovers depend on ethnic similarity, which suggests the influence of ethnic bias. This result implies, for policy making, that the question of interregional transaction costs cannot be narrowly focused on problems of transportation infrastructure but it is also related with ethnic divisions in African context.
    Keywords: Ethnic diversity, transaction cost
    JEL: R58 O18
    Date: 2010–10
  5. By: Nicholas T. Longford (SNTL and UPF, Barcelona, Spain); Maria Grazia Pittau (Department of Statistics, Sapienza University of Rome); Roberto Zelli (Department of Statistics, Sapienza University of Rome); Riccardo Massari (Sapienza University of Rome)
    Abstract: The European Union Survey on Income and Living Conditions (EU-SILC) is the main source of information about living standards and poverty in the member states of the European Union. It provides reliable statistics at national level but sample sizes do not allow reliable estimates at sub-national level, despite a rising demand from policy makers and local authorities. We provide a comprehensive map of median income, inequality (Gini coefficient and Lorenz curve) and poverty (poverty rates), at country and regional levels, based on the equivalized household income in all the countries in which EU-SILC is conducted. We focus on personal income distribution within regions as opposed to per capita income distribution across regions to give a deeper insight into regional disparities. Small-area estimation is applied to improve estimates in regions with small sample size. Uncertainty of such complex non-linear statistics is assessed by bootstrap methods. Household-level sampling weights are taken into account in both the estimates and their relative bootstrapped standard errors.
    Keywords: European regional economics measurement; EU-SILC; Gini coefficient; Poverty rates; Small-area estimation.
    JEL: D31 I32 R10 C13
    Date: 2010
  6. By: Angel de la Fuente
    Abstract: En una serie de trabajos anteriores he construido series largas de diversos agregados económicos regionales enlazando las distintas bases de la Contabilidad Regional de España entre sí y con las series históricas elaboradas por la Fundación BBVA. Puesto que esta última fuente sólo ofrece datos para años impares, las series enlazadas heredan esta característica desde 1955 hasta 1989. En la presente nota se construyen series anuales completas de las variables de interés utilizando un sencillo procedimiento de interpolación que incorpora la información anual disponible a nivel nacional para estas variables.
    Date: 2010–09
  7. By: Forte, Francesco; Magazzino, Cosimo; Mantovani, Michela
    Abstract: This study analyzes the negative performance of Calabria’s Regional Program 2000-2006, for the enhancement of cultural goods to attract tourism, as an example of the waste of resources of EU ambitious planning for the economic convergence. The empirical analysis shows that the variables relating to cultural sites, education sites and sites with tourism or tourism potentialities had no significance or even negative influence. The significant variables were the number of non profits present in the municipalities and the criminal hubs. The presence of cultural sites is not statistically significant in the allocation of funds to the criminal hubs, After the program the number of visitors and revenues from museum and archeological sites of Calabria lower than before while on average in Italy has had a great increase. On the other hand tourism in Calabria experienced a differential increase , in spite of the waste of the funds of the European regional policy.
    Keywords: Cultural goods; tourism; public policies; public expenditure; Southern Italy.
    JEL: R10 H41 Z10
    Date: 2010
  8. By: Ajay Agrawal (University of Toronto); Christian Catalini (University of Toronto); Avi Goldfarb (University of Toronto)
    Abstract: We examine the geography of early stage entrepreneurial finance in the context of an internet marketplace for funding new musical artist-entrepreneurs. A large body of research documents that investors in early-stage projects are disproportionately co-located with the entrepreneur. Theory predicts this will be particularly true of artist-entrepreneurs with preliminary-stage projects, difficult-to-contract-for effort, difficult-to-observe creativity, negligible tangible assets, and limited reputations. At the same time, however, observers of the spatial effects of the internet and related technologies report that many economic activities have become much less geographically dependent. At an aggregate level, the internet marketplace we examine does indeed demonstrate a spatial transformation of the entrepreneurial finance process: the average distance between investors and artist-entrepreneurs is 4,831 km. However, geography still matters; investors are disproportionately likely to be local and, conditional on investing, local investors invest more. This apparent role for proximity is strongest before entrepreneurs visibly accumulate capital. Within a single round of financing, local investors are more likely to engage earlier in the funding cycle. However, this difference in the timing of investment is almost entirely explained by a particular type of investor, whom we characterize as ``family, friends, and fans." We conjecture that these individuals, who are disproportionately co-located with the entrepreneur, have offline information about the entrepreneur and therefore derive less new information from observing the aggregate financing raised. We speculate that the path-dependent role of this offline network in conveying information to the online community limits the ``flat world'' potential of these communication technologies.
    Keywords: Entrepreneurial nance, crowd-funding, internet, family and friends, local bias, social networks
    JEL: R12 Z1 L17 G21 G24
    Date: 2010–09
  9. By: Miguel Atienza (Department of Economics, Universidad Católica del Norte); Marcelo Lufin (Department of Economics, Universidad Católica del Norte)
    Abstract: The structure of occupations by activity is not similar across a country (Barbour and Markusen, 2007). While this is true for most occupations, it is not the case for those that are knowledge intensive, which tend to be spatially concentrated. This article proposes a methodology to analyze the differences between the occupational and the industrial structures of regions and cities, and to identify which occupations contribute more to producing functional heterogeneity, controlling by sectoral differences. This methodology is applied in the case of the main cities of Chile using information from the 2002 census. The results show that, controlling by sector differences, a group of occupations introduce significant differences between cities, revealing their position in a hierarchy of functional relations
    Keywords: Cities, Industrial mix, Occupational mix
    JEL: R11 R12
    Date: 2010–04
  10. By: Jonathan Potter; Marco Marchese
    Abstract: This Review of Local Economic and Employment Development Policy Approaches in OECD Countries has been carried out by the OECD LEED Programme in collaboration with the Welsh Assembly Government (WAG). The aim of the review is to identify successful and/or innovative policy initiatives that could be relevant to Wales and regional economic development models that could inspire Wales's future strategy-making. Given the large volume of material already available on Welsh economic challenges and policies, the focus was not on "looking in" but on "looking out" at initiatives that could inspire Wales from other OECD regions, based on existing understanding of the challenges. The two main objectives of the review have therefore been: a) identify and analyse innovative and/or successful single policy tools that could potentially be applied in Wales; b) identify and analyse some broader regional economic strategies and their delivery arrangements that could inspire the overall economic development approach of Wales.
    Date: 2010–09
  11. By: Kai Andree
    Abstract: In this paper we develop a spatial Cournot trade model with two unequally sized countries, using the geographical interpretation of the Hotelling line. We analyze the trade and welfare effects of international trade between these two countries. The welfare analysis indicates that in this framework the large country benefits from free trade and the small country may be hurt by opening to trade. This finding is contrary to the results of Shachmurove and Spiegel (1995) as well as Tharakan and Thisse (2002), who use related models to analyze size effects in international trade, where the small country usually gains from trade and the large country may lose.
    Date: 2010–09
  12. By: Beaubrun-Diant, Kevin
    Keywords: Approche temporelle; Acquisition de logement; Approche géographique;
    JEL: R31
    Date: 2010–07
  13. By: Mahvish Shami (Institute of Food and Resource Economics, University of Copenhagen)
    Abstract: Up to the late 1980s it was generally accepted that many of the key issues in agrarian development could not be studied without an understanding that rural markets were interlinked, causing equilibria to be jointly determined. In recent years, however, theory on market interlinkages has disappeared from mainstream agrarian development literature. Based on a household-level survey conducted in rural Pakistan, this paper seeks to re-introduce the importance of interlinkages and to illustrate the exploitative potential this market structure can have for poor peasants, particularly in unequal isolated villages where the landlord is essentially a monopolist/monopsonist. A proposed solution is then to connect villages to the external economy so as to increase peasants’ alternative options. Making use of a natural experiment found in the construction of a motorway, the study finds that while connectivity does not break interlinkages completely - as they do have the functional effect of lowering transaction costs - it does significantly alter the nature of the relationship between landlords and the rural poor in favour of the latter, and in particular to the advantage of the socially lower classes.
    Keywords: Interlinked markets, Rural road networks, Pakistan
    JEL: R2 Q13
    Date: 2010–09
  14. By: Bergström, Lina (Uppsala University); van Ham, Maarten (University of St. Andrews)
    Abstract: The number of studies investigating neighbourhood effects has increased rapidly over the last two decades. Although many of these studies claim to have found evidence for neighbourhood effects, most 'evidence' is likely the result of reversed causality. The main challenge in modelling neighbourhood effects is the (econometric) identification of causal effects. The most severe problem is selection bias as a result of selective sorting into neighbourhoods. This paper argues that in order to further our understanding of neighbourhood effects we should explicitly incorporate neighbourhood sorting into our models. Neighbourhood effect studies are in the situation where the processes behind one of its key methodological problems (selection bias) are also critical to fully understand the neighbourhood context itself. It is thus remarkable that residential mobility and neighbourhood sorting has been almost completely ignored in the neighbourhood effects literature.
    Keywords: neighbourhoods, selective mobility, neighbourhood effects, selection bias, migration, residential mobility
    JEL: I30 J60 R23
    Date: 2010–09
  15. By: Reig Martínez Ernest (Universidad de Valencia; Ivie)
    Abstract: Rural municipalities show considerable heterogeneity in relation to their development potential, so the proper characterization of their socioeconomic status is a basic requirement in the design of rural development policies. This working paper shows, in the first place, how this task can be performed using nonparametric methods and, in particular, Data Envelopment Analysis (DEA). Secondly, it is found that the combination of a DEA-based approach and a multicriteria approach improves results by increasing the discriminatory power of the classic DEA model, and by generating common weights of socioeconomic variables for individual municipalities. The application of both methodological approaches has been illustrated with data from a sample of 48 municipalities in the Leader zone of the Autonomous Region of Valencia.
    Keywords: DEA, rural development, efficiency, socioeconomic potential, Leader zone
    Date: 2010–06

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