nep-geo New Economics Papers
on Economic Geography
Issue of 2010‒12‒18
eight papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Do cooperative R&D subsidies stimulate regional innovation efficiency? Evidence from Germany By Tom Broekel
  2. Regional comovement in employment over the business cycle in Mexico By Marcelo Delajara
  3. Measuring Regional Inequality by Internet Car Price Advertisements: Evidence for Germany By Konstantin A. Kholodilin; Boriss Siliverstovs
  4. A Statistical Test of City Growth: Location, Increasing Returns and Random Growth By González-Val, Rafael; Olmo, Jose
  5. Does Foreign Direct Investment Promote Regional Development in Developed Countries? A Markov Chain Approach for US States. By Bode, Eckhardt; Nunnenkamp, Peter
  7. Die Messung von Armut unter Berücksichtigung regional divergierender Lebenshaltungskosten und öffentlicher Leistungen By Hillringhaus, Tilman; Peichl, Andreas
  8. Defragmentation of Economic Growth with a Focus on Diversification: Evidence from Russian Economy By Gnidchenko, Andrey

  1. By: Tom Broekel
    Abstract: The paper investigates the impact of R&D subsidies on regional innovation efficiency. Building on a rich panel data set covering 270 German labor market regions and four industries, it is particularly shown that subsidies for R&D cooperation are a suitable policy measure for stimulating the innovation efficiency of regions. The empirical findings moreover suggest that regions with low innovation capacities benefit from subsidized inter-regional cooperation involving partners with diverse industrial and sectoral backgrounds. Establishing inter-regional cooperation that give access to related knowledge and skills is more important for regions with large innovation capacities.
    Keywords: innovation policy, regional innovation efficiency, R&D subsidies, cooperation networks, knowledge networks
    JEL: O18 O38 R58 R12
    Date: 2010–12
  2. By: Marcelo Delajara
    Abstract: We determine the extent of cyclical comovement in employment among the regions of Mexico by analyzing the covariance of the disturbances in regional cycles during the period July 1997 - October 2009. Employment refers to the number of workers with permanent contracts affiliated to the Instituto Mexicano del Seguro Social. Trend and cycle decomposition and the variance-covariance matrix of the cycle's disturbances are obtained from the estimation -using state space methods- of a structural multivariate model of the employment time series. We find, for most regions, that employment comovement is high and that the variance of the regional cycles' disturbances is largely associated with the fluctuations in national employment. We do not find evidence, however, of a common underlying cycle, which means that employment comovement would arise from the geographical propagation of regional specific shocks.
    Keywords: Employment, comovement, regions, Mexico.
    JEL: E32 R11 R23
    Date: 2010–12
  3. By: Konstantin A. Kholodilin (DIW Berlin, Germany); Boriss Siliverstovs (KOF Swiss Economic Institute, ETH Zurich, Switzerland)
    Abstract: We suggest to use Internet car sale price advertisements for measuring economic inequality between and within German regions. Our estimates of regional income levels and Gini indices based on advertisements are highly, positively correlated with the official figures. This implies that the observed car prices can serve as a reasonably good proxy for income levels. In contrast to the traditional measures, our data can be fast and inexpensively retrieved from the web, and more importantly allow to estimate Gini indices at the NUTS2 level – something that never has been done before. Our approach to measuring regional inequality is a useful alternative source of information that could complement the officially available measures.
    Keywords: Car price advertisements, economic inequality, German NUTS1 and NUTS regions, Gini index, Internet
    JEL: C21 O47 R11
    Date: 2010–07
  4. By: González-Val, Rafael; Olmo, Jose
    Abstract: This article analyzes the main existing theories on income and population city growth: the existence of increasing returns to scale, the importance of locational fundamentals, and random growth. To do this we develop a nonlinearity test that is implemented to a dataset on urban, climatological and macroeconomic variables on 1,175 U.S. cities. The conclusions of our analysis are that there are increasing returns to scale on city income growth; nevertheless, the most important variables to explain income growth are locational fundamentals. Both sets of variables need to be jointly considered to avoid inconsistent model parameter estimates. We also observe increasing returns to scale on population growth; larger cities grow at a faster pace than smaller cities. These cities are not, however, within the group of wealthiest cities implying the existence of a threshold on population beyond which per-capita income growth stagnates or even deteriorates.
    Keywords: threshold nonlinearity test; locational fundamentals; multiple equilibria; random growth
    JEL: C13 O10 R00 C12 C33 R11
    Date: 2010–12–01
  5. By: Bode, Eckhardt; Nunnenkamp, Peter
    Keywords: Direktinvestition; Regionale Entwicklung; Sozialprodukt; Regionale Disparität; Schätzung; USA;; Markov transition probability , likelihood ratio test , FDI , per-capita income , regional development , United States of America;
    Date: 2010
  6. By: Janno Reiljan; Aivo Ülper
    Abstract: The goal of this paper is to analyze the theoretical, political and organizational bases of the territorial division of the country into municipalities and offer a research direction for identifying conceptual solutions to the development problems in Estonian municipalities. The paper focuses on the territorial organization of administrative issues, looking at the remaining administrative aspects only insofar as they relate to the territorial organization of public administration and services. In order to accomplish the goal we tackle the following research tasks: systematize theories concerning the territorial division of the country into municipalities and analyze the possibilities and limitations for their application; discuss administrative-territorial reforms in Nordic countries, their causes and consequences; describe the development, nature and indicators of the administrative-territorial division of Estonia; empirically analyze the relationship between municipal size and capability and development indicators. The analysis of the theoretical approaches to municipal size pointed out that they are fragmented and incompatible. Some authors support small municipalities, and others large. The theoretical reasoning of both those directions is often strongly simplified and biased and a unified meta-theoretical approach has not been established. The empirical analysis revealed that there is no empirical evidence to confirm either the presence of significant size related advantages among municipalities or the existence of an optimal municipal size considering current municipal functions and financing. The lack of theoretical and empirical evidence on the necessity for administrative-territorial reform means that merging municipalities alone cannot significantly improve the public service delivery capacities and economic and democratic development of Estonian municipalities. This means that future studies should focus on analyzing public services from the perspective of their economic efficiency, quality and accessibility, and in doing so, determine the optimal size of regions for providing the various public services.
    Keywords: optimal size of municipalities, local governments’ financial potential, local political development, amalgamation, local government reform, local government efficiency
    JEL: H11 H70
    Date: 2010
  7. By: Hillringhaus, Tilman (University of Cologne); Peichl, Andreas (IZA)
    Abstract: Bislang beschränkt sich die Messung von Armut und Ungleichheit in der deutschen Armutsberichterstattung im Wesentlichen auf die Betrachtung des Nettoeinkommens. Ein solches Vorgehen vernachlässigt umfangreiche öffentliche Leistungen, die in Form von nichtmonetären Leistungen erbracht werden. Zudem impliziert es die Annahme deutschlandweit einheitlicher Lebenshaltungskosten. Eine gleichzeitige Erweiterung der Armuts- und Ungleichheitsmessung um den Wert öffentlicher Leistungen sowie regional divergierender Lebenshaltungskosten zeigt, dass die derzeitige Armutsberichterstattung die Armutsquote für Nord-, Ost- und Westdeutschland überschätzt, wohingegen eine Unterschätzung für den Süden der Republik erfolgt. Das Armutslückenverhältnis wird auf Ebene der Analyseregionen durch das aktuelle Vorgehen in der Regel überschätzt. Die Ungleichheit in der Einkommensverteilung stellt sich bei einer erweiterten Betrachtung weniger ungleich dar, als aufgrund des derzeitigen Vorgehens in der Armutsberichterstattung zu erwarten ist. Deutliche Unterschiede zwischen den Landesteilen bleiben bestehen, allerdings wirkt die Ungleichheit zwischen Osten und Westen bzw. Norden und Süden bei einer Erweiterung der Messweise um die oben genannten Kriterien weit weniger stark ausgeprägt als bislang allgemein angenommen.
    Keywords: Armut, Ungleichheit, Lebenshaltungskosten, öffentliche Leistungen
    JEL: D31 D63 H23 I32
    Date: 2010–11
  8. By: Gnidchenko, Andrey
    Abstract: In this paper, we develop a comprehensive analysis of diversification issues for Russian economy. Assessing diversification for nine different variables, we show that choice of a variable affects the result much, and that, unlike a popular opinion, equiproportional economic diversity measures are still useful in economic analysis. Developing a simple defragmentation of economic growth, we account for labor productivity and labor availability separately, and show that these components depend on different factors.
    Keywords: Diversification, economic growth, regions, Russia
    JEL: O18 O49 R15 R12 R11
    Date: 2010–12

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