nep-geo New Economics Papers
on Economic Geography
Issue of 2011‒01‒23
fifteen papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Spatial Structure and CO2 Emissions Due to Commuting: an Analysis on Italian Urban Areas By Andrea CIRILLI; Paolo VENERI
  2. Economic Geography By Jacques-François Thisse
  3. Can the economic impact of political decentralisation be measured? By Roberto Ezcurra; Andrés Rodríguez-Pose
  4. Spatial Cournot Competition and Consumers’ Heterogeneity: A Note By Corrado Benassi
  5. Instrument Variable Estimation of a Spatial Autoregressive Panel Model with Random Effects By Badi H. Baltagi; Long Liu
  6. Is it Redistribution or Centralization? On the Determinants of Government Investment in Infrastructure By Daniel Albalate; Germà Bel; Xavier Fageda
  7. More price competition can benefit spatial duopolists when the consumer preferences are uncertain By Michal Król
  8. Diferencias en el ingreso per cápita regional e infraestructura de transporte en México By Torres Preciado, Víctor Hugo; Polanco Gaytán, Mayrén; Manzanares Rivera, José Luis
  9. Reconciling top-down and bottom-up development policies By Riccardo Crescenzi; Andrés Rodríguez-Pose
  10. The Mezzogiorno and Italian economic policy By Luigi Cannari (editor); Daniele Franco (editor)
  11. The organisational decomposition of innovation and territorial knowledge dynamics – insights from the German software industry By Simone Strambach; Benjamin Klement
  12. Evolution of the Chinese Rural-Urban Migrant Labor Market from 2002 to 2007 By Qu, Zhaopeng (Frank); Zhao, Zhong
  13. Is there a metropolitan bias? The inverse relationship between poverty and city size in selected developing countries By Céline Ferré; Francisco H.G. Ferreira; Peter Lanjouw
  14. Immigration and the origins of regional inequality: Government-sponsored European migration to Southern Brazil before World War I By de Carvalho Filho, Irineu; Monasterio, Leonardo M
  15. Clustering or scattering: the underlying reason for regulating distance among retail outlets By Joan-Ramon Borrell; Laura Fernández-Villadangos

  1. By: Andrea CIRILLI (Universita' Politecnica delle Marche, Dipartimento di Economia); Paolo VENERI (Universita' Politecnica delle Marche, Dipartimento di Economia)
    Abstract: The aim of this paper is to investigate whether and to what extent the spatial configuration of an urban area affects its level of environmental externalities. Starting from previous contributions to this field of research, it examines several features of urban spatial structure - such as compactness, monocentricity, concentration and functional diversity - and attempts to gauge their environmental implications in terms of per capita CO2 emissions associated with a given pattern of commuting (i.e., mode of commuting and distance travelled). The main finding of the analysis on the 111 largest Italian urban areas is that urban spatial configuration is an important determinant of travel patterns and the associated level of per capita CO2 emissions. In particular, smaller, more compact and less monocentric areas are associated with lower levels of CO2 per commuter, with socio-demographic characteristics also playing a role.
    Keywords: CO2 emissions, commuting, environmental costs, urban spatial structure
    JEL: Q56 R14 R41
    Date: 2010–12
  2. By: Jacques-François Thisse (CORE, Université Catholique de Louvain and CREA, Université de Luxembourg)
    Date: 2011
  3. By: Roberto Ezcurra (Universidad Pública de Navarra); Andrés Rodríguez-Pose (IMDEA Social Sciences Institute)
    Abstract: This paper examines whether, given the increasing salience of subnational governments, political decentralisation has an impact on overall economic performance. It uses panel data analyses in order to determine the association between a number of the different indices of political decentralisation developed over the last decade and a half with two basic measures of economic performance: changes in aggregate GDP per head and the evolution of within country territorial inequalities. The results highlight that, in the case of economic growth, the perception we may have of how political decentralisation affects economic performance is highly contingent on the index we use, with results ranging from a mildly positive to a neutral influence of political decentralisation on economic growth. For regional inequalities, political decentralisation seems to lead to a rise in disparities, regardless of how political decentralisation is measured.
    Keywords: political decentralisation; economic growth; regional disparities; regions; Europe
    JEL: H70 R11 R59
    Date: 2011–01–05
  4. By: Corrado Benassi (Dipartimento di Scienze Economiche, Alma Mater Studiorum - Università di Bologna; The Rimini Centre for Economic Analysis)
    Abstract: We consider the standard model of spatial Cournot competition and show that a necessary condition for dispersion equilibria is that the distribution be not unimodal.
    Keywords: Spatial Cournot competition, consumers’ distribution
    JEL: D31 D40
    Date: 2011–01
  5. By: Badi H. Baltagi (Center for Policy Research, Maxwell School, Syracuse University, Syracuse, NY 13244-1020); Long Liu (Department of Economics, College of Business, University of Texas at San Antonio, One UTSA Circle, TX 78249-0633)
    Abstract: This paper extends the instrumental variable estimators of Kelejian and Prucha (1998) and Lee (2003) proposed for the cross-sectional spatial autoregressive model to the random effects spatial autoregressive panel data model. It also suggests an extension of the Baltagi (1981) error component 2SLS estimator to this spatial panel model.
    Keywords: Panel Data, Spatial Model, Two Stage Least Squares, Error Components.
    JEL: C13 C21
    Date: 2011–01
  6. By: Daniel Albalate (Department of Economic Policy, Universitat de Barcelona, Avinguda Diagonal 690, 08034 Barcelona, Spain.); Germà Bel (Department of Economic Policy, Universitat de Barcelona, Avinguda Diagonal 690, 08034 Barcelona, Spain.); Xavier Fageda (Department of Economic Policy, Universitat de Barcelona, Avinguda Diagonal 690, 08034 Barcelona, Spain.)
    Abstract: The dilemma efficiency versus equity, together with political partisan interests, has received increasing attention to explain the territorial allocation of investments. However, centralization intended to introduce or reinforce hierarchization in the political system has not been object as of now of empirical analysis. Our main contribution to the literature is providing evidence that meta-political objectives related to the ordering of political power and administration influence regional investment. In this way, we find evidence that network mode’s (roads and railways) investment programs are influenced by the centralization strategy of investing near to the political capital, while investment effort in no-network modes (airports and ports) appears to be positively related to distance. Since investment in surface transportation infrastructures is much higher than that in airports and ports, and taken into account that regions surrounding the political capital are poorer than the average, we suggest that centralization rather than redistribution has been the driver for the concentration of public investment on these regions.
    Keywords: Investment, infrastructures, centralization, redistribution
    Date: 2010–12
  7. By: Michal Król
    Date: 2011
  8. By: Torres Preciado, Víctor Hugo; Polanco Gaytán, Mayrén; Manzanares Rivera, José Luis
    Abstract: El objetivo de esta investigación consiste en ofrecer una primera aproximación acerca de la relación entre la disparidad económica regional y la inversión pública en infraestructura de transporte en México. En este sentido, el estudio comparte la perspectiva agregada que predomina en el análisis propuesto por Aschauer (1989). Sin embargo, el marco analítico difiere parcialmente del propuesto por dicho autor. En particular, siguiendo la estrategia de Mankiw, Romer y Weil (1990), se extiende el modelo de Solow para incluir explícitamente la infraestructura de transporte en el análisis. Esto permitirá estimar el efecto de dicha infraestructura en el nivel de ingreso per cápita regional. Con este fin, se estima un modelo en panel de datos y se realizan pruebas para determinar la presencia de efectos fijos, esto permite abandonar el supuesto de niveles de tecnologías idénticas, y por tanto, controlar por diferencias regionales debido a efectos no observados. Los resultados sugieren que la inversión pública en infraestructura carretera y ferroviaria se ha asignado con criterios de equidad, al parecer, con la finalidad de disminuir la inequidad en la dotación de infraestructura de transporte entre estados y mejorar el nivel de vida de los estados económicamente más atrasados. Por su parte, la inversión en aeropuertos y puertos estaría siendo asignada con criterios de eficiencia, aunque debe reconocerse que en el caso de los puertos también intervienen factores geográficos. Sin embargo, el que la magnitud de los coeficientes negativos sobrepasen la magnitud de los coeficientes positivos sugiere que el criterio de equidad predomina sobre el criterio de eficiencia, de hecho, el coeficiente estimado para la inversión agregada en infraestructura de transporte en el modelo 3 parece corroborar esta situación. De manera particular, considerando que aproximadamente el 80% de la inversión en infraestructura de transporte se concentra en la red carretera y que el coeficiente estimado es comparativamente mayor que en el resto de componentes de infraestructura, resulta claro que la inversión en este tipo de infraestructura parece erigirse como uno de los principales instrumentos para aminorar la disparidad económica regional. This investigation aims to offer a first sight on the relationship between regional economic disparities and public investment in transport infrastructure in Mexico. This study shares the aggregate perspective that features the analysis by Aschauer (1989), but differs in that, following the strategy of Mankiw, Romer and Weil (1990), the Solow model is extended to explicitly include transport infrastructure in the analysis and allowing estimating its effects on per capita regional income. To this end, a panel data model with fixed effects is estimated, which permit to abandon the assumption of identical technology levels and therefore controlling by regional differences due to non-observed effects. Results suggest that public investment in road and railroad infrastructures has been assigned under equity criteria, with possibly the aim of reducing the unequal distribution of transport infrastructure among states and improving standard of livings. On the other hand, investment in airports and ports seems to be assigned under efficiency criteria, while it should be recognized that investment in ports is related to geographical factors. Magnitudes of positive signs overpass that of negative signs suggesting that equity criteria may be predominant over efficiency criteria. In particular, given that 80% of transport infrastructure investment is concentrated in road infrastructure and that its related estimated coefficient is higher than the coefficients for the rest of infrastructure components, it is clear that investment in road infrastructure seems to be a key instrument to reduce regional economic disparities.
    Keywords: economía regiona; diferencias en el ingreso per cápita; infraestructura de transporte; carreteras; vías férreas; puertos; aeorpuertos; México. regional economics; per capita income differences; transport infrastructure; roads; railroads; ports; airports; Mexico.
    JEL: H54 R0 R11
    Date: 2010–01
  9. By: Riccardo Crescenzi (London School of Economics); Andrés Rodríguez-Pose (IMDEA Social Sciences Institute)
    Abstract: Top-down and bottom up development policies have been generally sold as two irreconcilable ends of the development intervention spectrum. Top-down policies, solidly based in micro- and macroeconomic theories, but lacking the adequate flexibility and ‘place-awareness’ to respond to local complexity; bottom-up approaches much more responsive to diverse territorial needs, but devoid of a clear conceptual framework. In this paper we aim to show that this division need not remain still and that the foundations of top-down and bottom-up development policies can be reconciled in a joint 'meso-level' conceptual framework which can serve simultaneously as a deductive justification for bottom-up local and regional development policies and as a coordination device between different policies.
    Keywords: development policies; top-down; bottom-up; integrated framework
    Date: 2011–01–05
  10. By: Luigi Cannari (editor) (Bank of Italy, Structural Economic Analysis Department); Daniele Franco (editor) (Bank of Italy, Structural Economic Analysis Department)
    Abstract: The volume brings together the papers presented at the Conference on "The Mezzogiorno and Italian economic policy " held in Rome on 26 November, 2009. The analysis focuses on social capital, the difficulties that businesses face in working in the South, the role of the financial system, the effectiveness of aid to enterprises, the role of public finance and regional development policies. Particular attention is devoted to assessing the quality of important public services: education, health, civil justice and local public services, with a preface by Giorgio Napolitano, President of the Italian Republic.
    Keywords: Mezzogiorno, regional policies, cohesion
    JEL: R0 R5
    Date: 2010–06
  11. By: Simone Strambach (Department of Geography, Philipps University Marburg); Benjamin Klement (Department of Geography, Philipps University Marburg)
    Abstract: In recent years, innovation processes involve more heterogenous actors inside and outside the firm. Little is known however about the spatial impact of this organisational decomposition of innovation processes (ODIP): Does it lead to a geographical dispersion of innovation activities as well? Furthermore, which parts of the innovation process are carried out spatially or organisationally separated? To what extent are knowledge-creating activities subject to organisational decomposition? We propose the analytical ODIP framework which integrates research on innovation systems, global value chains and knowledge-intensive business services (KIBS). Thereby we provide a conceptual contribution to the debate on the globalisation of innovation in the identification of different modes of decomposed innovation processes by capturing the participating actors and their contribution in specific innovation events. The exploration of the spatial dimension of innovation processes in the software industry shows that the global-local dichotomy in the innovation debate does not suffice to describe their complex, multi-scalar nature. In analysing ODIP in a knowledge-intensive industry, we contribute to the debate about the ‘new geography of innovation’ by providing insights into the upgrading of subsidiary capabilities.
    Keywords: ODIP, innovation, software, territorial knowledge dynamics
    JEL: D83 F23 L14 L86 O32
    Date: 2010–12
  12. By: Qu, Zhaopeng (Frank) (Beijing Normal University); Zhao, Zhong (Renmin University of China)
    Abstract: The paper studies the dynamic change of the migrant labor market in China from 2002 to 2007 using two comparable data sets. Our focus is on the rural-urban migration decision, the wage structure of migrants, the urban labor market segmentation between migrants and urban natives, and the changes of these aspects from 2002 to 2007. We find that prior migration experience is a key factor for the migration decision of rural household members, and its importance keeps increasing from 2002 to 2007. Our results show that there is a significant increase in wages among both migrants and urban natives over this 5-year period, but migrants have enjoyed faster wage growth, and most of the increase of wages among migrants can be attributed to the increase of returns to their characteristics. We also find evidence suggesting convergence of urban labor markets for migrants and for urban natives during this 5-year period.
    Keywords: rural-urban migration, labor market, wage structure, migration decision, segmentation, China
    JEL: J21 J61 O15
    Date: 2011–01
  13. By: Céline Ferré (World Bank); Francisco H.G. Ferreira (World Bank); Peter Lanjouw (World Bank)
    Abstract: This paper provides evidence from eight developing countries of an inverse relationship between poverty and city size. Poverty is both more widespread and deeper in very small and small towns than in large or very large cities. This basic pattern is generally robust to choice of poverty line. The paper shows, further, that for all eight countries, a majority of the urban poor live in medium, small, or very small towns. Moreover, it is shown that the greater incidence and severity of consumption poverty in smaller towns is generally compounded by similarly greater deprivation in terms of access to basic infrastructure services, such as electricity, heating gas, sewerage, and solid waste disposal. The authors illustrate for one country—Morocco—that inequality within large cities is not driven by a severe dichotomy between slum dwellers and others. The notion of a single cleavage between slum residents and well-to-do burghers as the driver of urban inequality in the developing world thus appears to be unsubstantiated—at least in this case. Robustness checks are performed to assess whether the findings in the paper are driven by price variation across city-size categories, by the reliance on an income-based concept of well-being, and by the application of small area estimation techniques for estimating poverty rates at the town and city level.
    Keywords: poverty and city size, urban poverty, slums.
    JEL: I32 O18 R20
    Date: 2011
  14. By: de Carvalho Filho, Irineu; Monasterio, Leonardo M
    Abstract: This paper studies the long-term consequences of the government-sponsored programs of European immigration to Southern Brazil before the Great War. We find that the municipalities closer to the original sites of nineteenth century government sponsored settlements (colônias) have higher per capita income, less poverty and dependence on Bolsa Família cash transfers, better health and education outcomes; and for the areas close to German colonies, also less inequality of income and educational outcomes than otherwise. Since that is a reduced form relationship, we then attempt to identify the relative importance of more egalitarian landholdings and higher initial human capital in determining those outcomes. Our findings are suggestive that more egalitarian land distribution played a more important role than higher initial human capital in achieving the good outcomes associated with closeness to a colônia.
    Keywords: Brazil; Migration; Rio Grande do Sul; German migration; Italian migration; New World; Land distribution; Human capital; Economic history of Latin America
    JEL: F22 N3 O15
    Date: 2011–01–10
  15. By: Joan-Ramon Borrell (Research Group on Governments and Markets (GiM) - Dep. de Política Econòmica - Institut d’Economia Aplicada (IREA), Universitat de Barcelona, Diagonal 690, 08034 Barcelona, Spain); Laura Fernández-Villadangos (Research Group on Governments and Markets (GiM) - Dep. de Política Econòmica - Institut d’Economia Aplicada (IREA), Universitat de Barcelona, Diagonal 690, 08034 Barcelona, Spain.)
    Abstract: Concerns on the clustering of retail industries and professional services in main streets had traditionally been the public interest rationale for supporting distance regulations. Although many geographic restrictions have been suppressed, deregulation has hinged mostly upon the theory results on the natural tendency of outlets to differentiate spatially. Empirical evidence has so far offered mixed results. Using the case of deregulation of pharmacy establishment in a region of Spain, we empirically show how pharmacy locations scatter, and that there is not rationale for distance regulation apart from the underlying private interest of very few incumbents.
    Keywords: distance, location, regulation, retailing
    JEL: L51 K23 H42
    Date: 2010–12

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