nep-geo New Economics Papers
on Economic Geography
Issue of 2011‒04‒16
fourteen papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Spatial disparities in hospital performances By Gobillon, Laurent; Milcent, Carine
  2. Cities, Skills, and Regional Change By Edward L. Glaeser; Giacomo A.M. Ponzetto; Kristina Tobio
  3. Comparing knowledge bases: on the organisation and geography of knowledge flows in the regional innovation system of Scania, southern Sweden By Martin, Roman; Moodysson , Jerker
  4. Inter-regional Competition, Comparative Advantage, and Environmental Federalism By Paul Missios; Ida Ferrara; Halis Murat Yildiz
  5. The impact of interregional and intraregional transportation costs on industrial location and efficient transport policies By Paul Chiambaretto; André De Palma; Stef Proost
  6. Regional Growth Dynamics in Central and Eastern Europe By Vassilis Monastiriotis
  7. Regional Inequality of Higher Education in China and the Role of Unequal Economic Development By Frank Bickenbach; Wan-Hsin LIU
  8. A dinâmica setorial e os determinantes locacionais das microrregiões paulistas By Admir Antonio Betarelli Junior; Rodrigo Ferreira Simões
  9. Banking Geography and Cross-Fertilization in the Productivity Growth of US Commercial Banks By Dogan Tirtiroglu; A. Basak Tanyeri; Ercan Tirtiroglu; Mehmet Kenneth N. Daniels
  10. Gas Prices Variations and Urban Sprawl: an Empirical Analysis of the 12 Largest Canadian Metropolitan Areas By Georges A. Tanguay; Ian Gingras
  11. Romer’s Charter Cities v. Colonization, Imperialism, and Colonialism: A General Characterization By Amavilah, Voxi Heinrich
  12. Mafia and Public Spending: Evidence on the Fiscal Multiplier from a Quasi-experiment By Antonio Acconcia; Giancarlo Corsetti; Saverio Simonelli
  13. Fiscal Zoning and Sales Taxes: Do Higher Sales Taxes Lead to More Retailing and Less Manufacturing? By Daria Burnes; David Neumark; Michelle J. White
  14. Governance and Creativity on Urban Regeneration Processes By Paulo Neto; Maria Manuel Serrano

  1. By: Gobillon, Laurent; Milcent, Carine
    Abstract: Spatial disparities in mortality can result from spatial di¤erences in patient characteristics, treatments, hospital characteristics, and local healthcare market structure. To distinguish between these explanatory factors, we estimate a flexible duration model on stays in hospital for a heart attack using a French exhaustive dataset. Over the 1998-2003 period, the raw disparities in the propensity to die within 15 days between the extreme regions reaches 80 %. It decreases to 47% after taking into account the patients' characteristics and their treatments. We conduct a variance analysis to explain regional disparities in mortality. Whereas spatial variations in the use of innovative treatments play the most important role, spatial di¤erences in the local concentration of patients also play a significant role.
    Keywords: Spatial Health Disparities; Economic Geography; Stratified Duration Model
    JEL: I11 C41
    Date: 2010–06
  2. By: Edward L. Glaeser; Giacomo A.M. Ponzetto; Kristina Tobio
    Abstract: One approach to urban areas emphasizes the existence of certain immutable relationships, such as Zipf’s or Gibrat’s Law. An alternative view is that urban change reflects individual responses to changing tastes or technologies. This paper examines almost 200 years of regional change in the U.S. and finds that few, if any, growth relationships remain constant, including Gibrat’s Law. Education does a reasonable job of explaining urban resilience in recent decades, but does not seem to predict county growth a century ago. After reviewing this evidence, we present and estimate a simple model of regional change, where education increases the level of entrepreneurship. Human capital spillovers occur at the city level because skilled workers produce more product varieties and thereby increase labor demand. We find that skills are associated with growth in productivity or entrepreneurship, not with growth in quality of life, at least outside of the West. We also find that skills seem to have depressed housing supply growth in the West, but not in other regions, which supports the view that educated residents in that region have fought for tougher land-use controls. We also present evidence that skills have had a disproportionately large impact on unemployment during the current recession.
    JEL: D00 R00
    Date: 2011–04
  3. By: Martin, Roman (CIRCLE, Lund University); Moodysson , Jerker (CIRCLE, Lund University)
    Abstract: This paper deals with knowledge flows and collaboration between firms in the regional innovation system of southern Sweden. It focuses on industries which draw on different types of knowledge bases. The aim is to analyse how the functional and spatial organisation of knowledge interdependencies among firms and other actors vary between different types of industries which are part of the same regional innovation system. We argue that knowledge sourcing and exchange in geographical proximity is especially important for industries that rely on a synthetic or symbolic knowledge base, since the interpretation of the knowledge they deal with tend to differ between places. This is less the case for industries drawing on an analytical knowledge base, which rely more on scientific knowledge that is codified, abstract and universal, and therefore less sensitive to geographical distance. Thus, geographic clustering of firms in analytical industries builds on other rationale than the need of proximity for knowledge sourcing and exchange. To analyse these assumptions empirically, we draw on data from three case studies of firm clusters in the region of southern Sweden: (1) the life science cluster represents an analytical (science) based industry, (2) the food cluster includes mainly synthetic (engineering) based industries, and (3) the moving media cluster is considered as symbolic (artistic) based. Knowledge sourcing and knowledge exchange in each of the cases are explored and compared using social network analysis in association with a dataset gathered through interviews with firm representatives.
    Keywords: knowledge bases; life science; food cluster; moving media; Sweden
    JEL: O32
    Date: 2011–04–11
  4. By: Paul Missios (Department of Economics, Ryerson University, Toronto, Canada); Ida Ferrara (DEpartment of Economics, York University, Toronto, Canada); Halis Murat Yildiz (Department of Economics, Ryerson University, Toronto, Canada)
    Abstract: In this paper, we compare endogenous environmental policy setting with centralized and decentralized governments when regions have comparative advantages in different polluting goods. We develop a two-region, two-good model with inter-regional environmental damages and perfect competition in product markets, where both regions produce both goods. Despite positive spillovers of pollution across regions, the model predicts that decentralization may lead to weaker or stricter environmental standards or taxes, depending on the degree of regional comparative advantage and the extent of transboundary pollution. This suggests that federalism can lead to either a "race to the bottom" or a "race to the top," without relying on inefficient lobbying efforts or capital competition.
    Keywords: environmental policy; federalism; centralism; public economics
    JEL: D10 H23 Q28
    Date: 2011–01
  5. By: Paul Chiambaretto (crg - Centre de recherche en Gestion - Ecole Polytechnique); André De Palma (ENS Cachan - Ecole Normale Supérieure de Cachan - École normale supérieure de Cachan - ENS Cachan, Department of Economics, Ecole Polytechnique - CNRS : UMR7176 - Polytechnique - X, CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Stef Proost (Center for Economic Studies - CES - KU Leuven - CES - KU Leuven)
    Abstract: Almost all models of the (New) Economic Geography have focused on interregional transportation costs to understand industrial location, considering regions as dots without intraregional transportation costs. We introduce a distinction between interregional and intraregional transportation costs. This allows assessing more precisely the effects of different types of transport policies. Focusing on two regions (a core and a periphery), we show that improving the quality of the interregional infrastructure, or of the intraregional infrastructure in the core region, leads to an increased concentration of activity in the core region. However, if we reduce intraregional transportation costs in the periphery, some firms transfer from the core to the periphery. From an efficiency point of view, we observe that, in absence of regulation, the concentration of firms is too high in the center. We show what set of policies improves the equilibrium.
    Keywords: Economic geography ; Industrial location ; Transportation costs; Intraregional ; Interregional ; Concentration ; Transport Policies
    Date: 2011–04–05
  6. By: Vassilis Monastiriotis
    Abstract: This paper examines the regional growth process of the countries of Central and Eastern Europe since the start of their transition to market economies. It relates this to three distinctive explanations of regional growth and examines empirically their relevance in explaining the patterns of disparity and polarisation that have emerged in these countries over the last two decades. The collapse of communism and the early transition shock that followed created in many respects an experiment-like situation with a set of ‘initial conditions’ conducive for analysing patterns of convergence and divergence in the processes of national economic development and cross-national catch-up growth. The path to EU accession intensified the speed of these processes at the national level thus making the corresponding regional evolutions more marked. Our empirical analysis unveils a complex pattern of non-linear regional growth dynamics with convergence tendencies largely swaddled by processes of cumulative causation. Despite the process of national catch-up growth, regional evolutions are on the whole divergent, with a pattern of convergence at the middle- and lower-ends of the distribution and a slower tendency for club formation at the higher end, and thus overall an increasing trend of polarisation.
    Date: 2011–04–04
  7. By: Frank Bickenbach; Wan-Hsin LIU
    Abstract: Over the past decade the scale of higher education in China has expanded substantially. Regional development policies attempted to make use of the scale expansion as a tool to reduce the inequality of higher education among different regions with different development levels through providing the poor regions preferential treatment and support in this regard. This paper analyses a provincial dataset (1997-2008), aiming to provide comprehensive quantitative evidence for the development of inequality of higher education opportunities across provinces in China over the period of the scale expansion, taking different sizes and economic development levels of provinces into account. Results show that the regional inequality of higher education relative to provinces’ different population sizes clearly decreased over the research period. Accompanying the reduction in overall inequality across provinces, the inequality between the poor and the rich regions actually increased over the same period. However, the increase was realised in favour of the poor region. The empirical results are consistent with the policy orientation of reforming the higher education system and of promoting regional development in China over the past decade
    Keywords: higher education, regional inequality, China, Theil index
    JEL: C43 I23 I28 R53 R58
    Date: 2011–04
  8. By: Admir Antonio Betarelli Junior (Cedeplar-UFMG); Rodrigo Ferreira Simões (Cedeplar-UFMG)
    Abstract: The main aim of this paper is to analyze the locational factors of urbanization in State of São Paulo (Brazil) between 2000 and 2005. Using a micro-regional database, we apply a set of techniques: a) the method shift-share (Esteban-Marquillas), b) Principal Component Analysis (PCA) and Cluste Analysisr. The main results indicate that the process of occupation of the countryside by economic activities and migration (began in the late 70s) has directly benefited the micro-regions of Campinas, São José dos Campos, Sorocaba, Ribeirão Preto, Santos and Jundiaí. The effects of this process have spilled over to the surrounding regions, creating the present competitive and locational advantages, and forming urban agglomerations in the State area.
    Keywords: Locational factors; Internalization of the industry; Shift-share; Multivariate Analysis; Brazil.
    JEL: C02 R11
    Date: 2011–04
  9. By: Dogan Tirtiroglu (The University of Adelaide, Business School, Australia); A. Basak Tanyeri (Bilkent University, Faculty of Business Administration Ankara, Turkey); Ercan Tirtiroglu (The University of Adelaide, Business School, Australia); Mehmet Kenneth N. Daniels (Virginia Commonwealth University, School of Business Richmond, VA)
    Abstract: The US banking industry offers a unique, natural and fertile environment to study geography's effects on banks' behavior and performance. The literature on banks' operating performance, while extensive, says little about the influence of spatial interactions on banks' performance. We compute and examine, using a physical distance-based spatio-temporal empirical model, the state-wide total factor productivity growth (TFPG) indices of US commercial banks for each state for the 1971-1995 period. We observe that the productivity growth of commercial banks in state i depends strongly, positively, and contemporaneously on the productivity growth of commercial banks located in state i's contiguous states. Further, “regulatory space” appears to induce frictions and lessen the documented spatial interactions. These findings support our plea that research on commercial banking sector's behavior need to pay a particular attention to the effects of banking geography.
    Keywords: Spatial, Commercial Banks, Total Factor Productivity Growth, Kalman Filter
    JEL: D24 C23 G21 G28 K23
    Date: 2011–04
  10. By: Georges A. Tanguay; Ian Gingras
    Abstract: We conduct a multivariate analysis of the potential impact of higher gas prices on urban sprawl in the 12 largest Canadian Metropolitan Areas for the period 1986-2006. Controlling for variables such as income and population, we show that higher prices of gas have contributed significantly to reduce urban sprawl. On average, a 1% increase in gas prices has caused: i) a 0.32% increase in the population living in the inner city and ii) a 1.28% decrease in low-density housing units. Our results also show that higher incomes have played a significant role in increasing urban sprawl. <P>Nous procédons à une analyse multivariée afin de déterminer les effets d’une hausse du prix de l’essence sur l’étalement urbain dans les 12 plus grandes régions métropolitaines canadiennes pour la période 1986-2006. En tenant compte de variables de contrôle comme le revenu et la population, nous démontrons que des prix de l’essence plus élevés ont contribué significativement à réduire l’étalement urbain. En moyenne, une hausse de 1 % du prix de l’essence a mené à: i) une augmentation de 0,32 % de la population vivant au centre des villes et ii) une baisse de 1,28 % des logements à faible densité. Nos résultats démontent aussi que les hausses des revenus des ménages ont été un facteur significatif ayant contribué à l’étalement urbain.
    Keywords: Urban Sprawl, Gas Prices, Canadian Metropolitan Areas., Étalement urbain, prix de l’essence, régions métropolitaines canadiennes.
    Date: 2011–04–01
  11. By: Amavilah, Voxi Heinrich
    Abstract: Paul Romer’s radical idea of chartering cities to stimulate long run economic growth and development has provoked a hot debate, not all supportive. Some of the opposition argues that the charter-city model is an antiquated idea that conjures up brutal images of failed (neo)colonialism. This essay characterizes colonization, imperialism, and colonialism in order to shed extra light on why and how effects of chartering a city are dissimilar to the effects of colonization, imperialism, and colonialism. The characterization finds that while colonization, imperialism, and colonialism share strong historical affinities, no such connections can reasonably be made to the charter-city idea. A key assumption (requirement) of the charter-city model is voluntary participation of all players. Colonization, imperialism, and colonialism were forceful and repressive systems which relied on both government cohesion and administered prices, and were therefore inefficient. Monopoly gains (rents) from colonization, imperialism, and colonialism came at the expense of reduced consumer surplus elsewhere. Success depended on monopoly rents from the trade in “objects.” Under charter cities the potential benefits to the urbanization and the economic growth of developing countries are huge. The charter-city model requires voluntary agreements. By overcoming the twin problems of consensus building and commitment utilizing market mechanisms, charter cities generate gains from the exchange of ideas. Evidence is starting to emerge suggesting that people understand that charter cities are not tentacles of (neo)colonialism; they promise real benefits if only policy makers decide to break old rules.
    Keywords: charter city; Paul Romer on ideas; colonization; colonialism; imperialism; economic growth
    JEL: O1 F5 O33 F54
    Date: 2011–02–18
  12. By: Antonio Acconcia (Università di Napoli Federico II and CSEF); Giancarlo Corsetti (Cambridge University, EUI, Rome III and CEPR.); Saverio Simonelli (University of Naples "Federico II" and CSEF)
    Abstract: We estimate the multiplier by relying on differences in spending in infrastructure across Italian provinces and an instrument identifying investment changes that are large and exogenous to local cyclical conditions. We derive our instrument from the Italia law mandating the interruption of public work on evidence of mafia infiltration of city councils. Our IV estimates on cross sectional data allow us to address common problems in time series analysis, such as the risk of estimating spuriously high multipliers because of endogeneity and reverse causation, or the risk of confounding the e¤ects of fiscal and monetary measures. While accounting for contemporaneous and lagged effects, and controlling for the direct impact of anti-ma.a measures on output, our results suggest a multiplier as high as 1.4 on impact, and 2 including dynamic effects.
    Keywords: Government Spending, Multiplier, Instrumental Variables
    Date: 2011–04–05
  13. By: Daria Burnes; David Neumark; Michelle J. White
    Abstract: We test the hypothesis that local government officials in jurisdictions that have higher local sales taxes are more likely to use fiscal zoning to encourage retailing. We find that total retail employment is not significantly affected by local sales tax rates, but employment in big box and anchor stores is higher significantly in jurisdictions with higher sales tax rates. This suggests that local officials in jurisdictions with higher sales taxes concentrate on attracting large stores and shopping centers. We also find that the effect of local sales taxes on big box and anchor store retail employment is larger in county interiors, where residents tend to be captive to local retailers. Finally, fiscal zoning has the opposite effect on manufacturing employment, suggesting that local officials’ efforts to attract shopping centers and large stores crowd out manufacturing.
    JEL: H71 J2 R52
    Date: 2011–04
  14. By: Paulo Neto (University of Évora, Department of Economics and CEFAGE-UE); Maria Manuel Serrano (University of Évora, Department of Sociology and SOCIUS – ISEG/UTL)
    Abstract: Governance has become a central topic among policymakers. There is an international consensus that policymaking is evolving from a traditional top-down government approach towards a system of governing that focuses on engaging the citizens within an area (Cabus, 2003). New forms of governance targeting urban competitiveness are increasingly oriented to vertical (between lower and high levels of government and cooperation forms between entities and firms along the production chain) and horizontal (between firms or different municipalities or public and private entities) cooperation (OEDC, 2005). Based on a study research methodology, this article seeks to contribute to answer to the following research questions: i) what is the role of governance in the processes of urban regeneration?; ii) what is the role of governance in the development of creative processes for urban regeneration? and iii) what is the potential of governance to support urban regeneration strategies based on creativity and creative industries?
    Keywords: Territorial governance, Creativity, Urban regeneration.
    JEL: R58 R52
    Date: 2011

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