nep-geo New Economics Papers
on Economic Geography
Issue of 2011‒05‒24
23 papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Spatial Unemployment Differentials in Colombia By Ana Maria DIAZ ESCOBAR
  2. Economic Growth in the Philippines: A Spatial Econometrics Analysis at the Provincial Level, 1991 â 2000. By Pede, Valerien O.; Huelgas, Zenaida; Villano, Lorena; Garcia, Cornelia; Mckinley, Justin D.; Mohanty, Samarendu
  3. Residui fiscali regionali e riforma federalista. Quanto residuerà delle politiche regionali e redistributive? By Giannola, A.; Petraglia, C.; Scalera, D.
  4. Exploiting spatial and temporal variations in residential subdivision development to identify urban growth spillovers By Towe, Charles; Klaiber, H. Allen; Wrenn, Doug; Newburn, David; Irwin, Elena G.
  5. Testing the Neoclassical Migration Model: Overall and Age-Group Specific Results for German Regions By Timo Mitze; Janina Reinkowski
  6. The determinants of Italy’s regional imbalances over the long run: exploring the contributions of human and social capital By Emanuele Felice
  7. Does open space increase development? By Zipp, Katherine; Lewis, David; Provencher, Bill
  8. The Employment Advantages of Skilled Urban Areas By Ana Maria DIAZ ESCOBAR
  9. Impacts of the Boom-Bust Cycle on the Effectiveness of Policies for Moderating the Consequences of Sprawl on Residential Development By Kim, SeungGyu; Cho, Seong-Hoon; Lambert, Dayton M.; Roberts, Roland K.
  10. Local Geography of Row-Crop Quality Land and Cropland Cash Rental Rates By Du, Xiaodong; Hennessy, David A.
  11. Economic Development Impacts of Wind Turbine Development in U.S. Counties By Brown, Jason P.; Hoen, Ben; Lantz, Eric; Pender, John; Wiser, Ryan
  12. Are Geese Flying by Themselves inside China? An LSTR-SEM Approach to Income Convergence of Chinese Counties By Konstantin A. Kholodilin; Eric Girardin
  13. Inflation Targeting and Regional Inflation Persistence: Evidence from Korea By Peter Tillmann
  14. Regional variations in labor force behavior of women in Japan By Abe, Yukiko
  15. The Economic Growth Impacts of Sugarcane Expansion In Brazil: An Inter-Regional Analysis By Deuss, Annelies
  16. The Determinants of Self-Employed Income in a Regional Economy By Swindall, Devin C.; Willis, David B.; Boys, Kathryn A.; Hughes, David W.
  17. Characterizing Spatial Pattern in Ecosystem Service Values when Distance Decay Doesnât Apply: Choice Experiments and Local Indicators of Spatial Association By Johnston, Robert J.; Ramachandran, Mahesh; Schultz, Eric T.; Segerson, Kathleen; Besedin, Elena Y.
  18. Spatial Pricing Patterns of Cellulosic Biomass under Oligopsony â A Multi-agent Simulation Model By Kumarappan, Subbu
  19. Relationship between Spatial Price Transmission and Geographical Distance in Brazil By Hernandez-Villafuerte, Karla Vanessa
  20. Copula-Based Nonlinear Models of Spatial Market Linkages By Goodwin, Barry K.; Holt, Matthew T.; Prestemon, Jeffrey P.; Onel, Gulcan
  21. The Determinants of Rural Urban Migration: Evidence from NLSY Data By Jordan, Jeffrey; Mykerezi, Elton; Kostandini, Genti; Mills, Bradford
  22. Local Government Efficiency: Evidence from the Czech Municipalities By Lenka Šastná; Martin Gregor
  23. Channels of risk-sharing among Canadian provinces: 1961--2006 By Balli, Faruk; Basher, Syed Abul; Jean Louis, Rosmy

  1. By: Ana Maria DIAZ ESCOBAR (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))
    Abstract: This paper studies the geographic distribution of unemployment rates in Colombian urban areas. It introduces measures of spatial correlation and spatial econometric techniques to analyze the dependence in local unemployment rates across municipalities. Results suggest that Colombian municipalities have experienced a polarization process between 1993 and 2005, as municipalities' unemployment rates have followed different evolutions relative to the National average. This process has been accompanied by the creation of unemployment clusters, that is to say, municipalities had very similar unemployment outcomes to those of their neighbors. This analysis uses a spatial Durbin model to explore the influence of various factors in determining differences in regional unemployment rates. According to our findings differences in labor demand, immigration rates, and urbanization are factors behind observed municipal unemployment disparities.
    Keywords: local labor markets, unemployment di erential, polarization, clustering, spatial econometrics, spatial Durbin model
    JEL: R23 C14 C23 C31
    Date: 2011–04–27
  2. By: Pede, Valerien O.; Huelgas, Zenaida; Villano, Lorena; Garcia, Cornelia; Mckinley, Justin D.; Mohanty, Samarendu
    Abstract: Investigating the determinants of economic growth remains a long research tradition in the economic growth literature. Most studies in this literature have tried to link economic growth and different economic factors using either neoclassical growth theories or endogenous growth approaches. These studies apply these growth theories to identify the factors responsible for the observed differences/disparities between regions or countries. While early studies focused on cross-country analyses, the recent most studies consider regions or sub-national entities as unit of analysis. This has raised the question of whether theories developed for cross-country analysis could be automatically applied for regional or sub-national analysis. Given the profound difference between nations and regions in terms of degree of openness, theories developed in cross-country analysis may not be automatically applied in regional analysis (see Mangrini, 2004). However, properly accounting for the spatial interaction effects may provide a way to use these theories in regional analysis. Regional analysis of economic growth has therefore spurned the development of specialized quantitative methods designed to account for the spatial dimensions of higher resolution, spatially referenced data. The goal of this research is to investigate the process of regional economic growth in the Philippines focusing on provincial data. Previous studies on regional growth within the Philippines have analyzed the regional growth process following neoclassical growth models or endogenous growth models without explicitly modeling spatial dependence between regions and the role of spillover effects. Traditional growth regressions with ordinary least squares may yield biased or inconsistent estimates if spatial autocorrelation is present but have been accounted for. This paper uses spatial econometrics techniques to estimate three theoretical growth models: the unconditional growth model, the Solow model and the Mankiw Romer and Weil model. Investment and human capital were found to be the main drivers of economic growth.
    Keywords: Community/Rural/Urban Development, Research and Development/Tech Change/Emerging Technologies, Research Methods/ Statistical Methods,
    Date: 2011
  3. By: Giannola, A.; Petraglia, C.; Scalera, D.
    Abstract: This paper criticizes the idea to conceive the fiscal federalist reform in Italy as a tool to empower central-northern regions to retain resources otherwise wasted in the South. We argue that such a view muddles up efficiency and redistribution issues, thus threatening the legitimate inter-regional fiscal flows. To dispute the thesis of excessive transfers to Mezzogiorno regions, we first show that the regional distribution of (both current and capital) government expenditure has systematically penalized the South in the last 15 years. Secondly, for the years 2004-2006, we calculate «benchmark» regional fiscal residua, consistent with the progressive Italian personal taxation (IRPEF), and the announced targets of regional policies (45% of total capital government expenditure to be made in the South). For most centre-northern regions, the actual residua turn out to be lower than the «benchmark» ones.
    Keywords: Mezzogiorno; redistribution; inter-governmental relations; federalism; regional development policies
    JEL: H77 E62 H70 H50 O10 H23
    Date: 2011–02–01
  4. By: Towe, Charles; Klaiber, H. Allen; Wrenn, Doug; Newburn, David; Irwin, Elena G.
    Abstract: Minimum lot size zoning requirements are a frequent policy tool used to restrict the density and location of residential development. Zoning regulations are typically instituted and adopted locally, often with limited input from surrounding jurisdictions. Autonomous local land use regulations that constrain some, but not all development within a region create discrete differences in the returns to development across otherwise similar locations and are hypothesized to lead to a lower density, more scattered land development pattern. We examine the rural down-zoning policy in Baltimore County, Maryland in 1976 and its potential effect on creating urban growth spillovers in the adjacent counties. Using propensity score matching methods combined with a difference-in-difference econometric strategy, we find that this down-zoning policy resulted in significant spillover impacts to surrounding counties in areas observationally similar to those down-zoned in Baltimore County. To our knowledge, this is first analysis of regional spillover impacts resulting from zoning across county boundaries that relies on spatially disaggregated parcel-level data.
    Keywords: Down-zoning, Propensity score matching, Low density development, Housing supply, Community/Rural/Urban Development,
    Date: 2011
  5. By: Timo Mitze; Janina Reinkowski
    Abstract: This paper tests the empirical validity of the neoclassical migration model in predicting German internal migration flows. We estimate static and dynamic migration functions for 97 Spatial Planning Regions between 1996 and 2006 using key labor market signals including income and unemployment differences among a broader set of explanatory variables. Besides an aggregate specification we also estimate the model for agegroup related subsamples. Our results give empirical support for the main transmission channels identified by the neoclassical framework – both at the aggregate level as well as for age-group specific estimates. Thereby, the impact of labor market signals is tested to be of greatest magnitude for workforce relevant age-groups and especially young cohorts between 18 to 25 and 25 to 30 years. This latter result underlines the prominent role played by labor market conditions in determining internal migration rates of the working population in Germany.
    Keywords: German internal migration; Harris-Todaro Model; dynamic panel data
    JEL: R23 C31 C33
    Date: 2010–11
  6. By: Emanuele Felice (Autonomous University of Barcelona and University of Siena)
    Abstract: The article aims to present and discuss estimates of levels of human and social capital in Italy’s regions over the long term, i.e. roughly from the second half of the nineteenth century up to the present day. The results are linked to newly available evidence for regional value added in order to begin to form an explanatory hypothesis of long-term regional inequality in Italy. More particularly, convergence in value added per capita across Italy’s regions is tested (through both cross-section and dynamic panel regressions) in light of the neoclassical exogenous growth approach, which incorporates human capital and social capital as conditioning variables into a long-term production function. On the whole, the results confirm the importance of conditioning variables, i.e. of regional differences in human capital and social capital, but also suggest that their impact significantly changed over the twentieth century, thus supporting the view that, in different periods, conditioning variables are determined by technological regimes.
    Keywords: regional history, human capital, social capital, convergence
    JEL: E13 E24 N93 N94 R11
    Date: 2011–03–28
  7. By: Zipp, Katherine; Lewis, David; Provencher, Bill
    Keywords: Land-use change, spatial modeling, Land Economics/Use,
    Date: 2011
  8. By: Ana Maria DIAZ ESCOBAR (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))
    Abstract: This paper explores whether the agglomeration of human capital leads to social employment advantages in urban labor markets of a developing country: Colombia. I estimate the social effects of human capital agglomeration by comparing employment opportunities of individuals located in urban areas in which the level of education differs. Results show that employment opportunities are higher on average in skilled urban areas. Three explanations have been offered: human capital externalities, production complementarities, and consumption spillovers. To distinguish between them, I analyze the effect of an increase on the college share on the employment rate for different education groups. Spatial employment differences in Colombia are mostly explained by human capital externalities and production complementarities.
    Keywords: local labor markets, employment, human capital externalities, production complementarities, consumer demand spillovers, signaling, congestion
    JEL: R23 J21 J24
    Date: 2011–04–26
  9. By: Kim, SeungGyu; Cho, Seong-Hoon; Lambert, Dayton M.; Roberts, Roland K.
    Keywords: urban sprawl, spatial discrete-choice model, Land Economics/Use,
    Date: 2011
  10. By: Du, Xiaodong; Hennessy, David A.
    Abstract: While farmland rental markets are likely to be spatially differentiated, the fine spatial structure of row-crop quality land should have a significant effect on cash rent determination. This study provides a rigorous empirical understanding of the effect of land spatial heterogeneity on cash rental rates. The lacunarity index is employed to measure spatial heterogeneity of land quality, which is built directly upon a soil quality measure, the land parcelâs corn suitability rating index (CSR). A panel data random effect model is applied on annual survey data of farmland cash rental rates of Iowa for 1987-2009. As expected, land spatial heterogeneity has a statistically significant and negative effect on local cash rent rates. The effectâs origin warrants further research.
    Keywords: land spatial heterogeneity, rental market., Agricultural Finance, C5, G1, Q1,
    Date: 2011–05
  11. By: Brown, Jason P.; Hoen, Ben; Lantz, Eric; Pender, John; Wiser, Ryan
    Abstract: We model the marginal impacts of wind turbine development on county-level changes in per capita income and employment in 15 states from 2000 to 2008. Using propensity score matching and spatial econometric techniques, we find that the total marginal impact on per capita income of wind turbine development (measured in MW per capita) when controlling for spatial effects was statistically significant with a value of $21,604 per MW. This estimate is within the range of values estimated in the literature using input-output models. Our ex post estimates of employment impacts are not precise enough to inform the validity of ex ante employment impacts from input-output models.
    Keywords: wind turbine, propensity score matching, spatial lag model, Community/Rural/Urban Development, Resource /Energy Economics and Policy, O13, Q21, R11,
    Date: 2011
  12. By: Konstantin A. Kholodilin; Eric Girardin
    Abstract: In this paper, we examine beta-convergence of real per-capita income of Chinese counties. We account for both the spatial dependences between counties and the possibility of different convergence regimes. The first feature is captured by the spatial error term, whereas the second one is modeled using the spatial logit smooth transition approach. Two groups of counties can be identified: 1) counties, which have relatively poor neighbors and tend to grow faster and converge, and 2) counties, which have relatively rich neighbors and tend to grow slower and hence fail to converge. The counties belonging to the first group are concentrated mainly in western interior provinces, such as Qinghai, Sichuan, Yunnan, western part of Xinjiang Uygur. The counties of the second group are located mainly in coastal regions. Whereas in the benchmark model the estimated convergence rate is 0.8% for unconditional regression and 1.7% for condtional regression, the alternative models produce the convergence rate of 1.3-1.5% for unconditional regressions and 2.3-2.6% for conditional regressions, which is quite close to the estimates reported typically in the literature.
    Keywords: Chinese counties, income convergence, LSTR, spatial effects
    JEL: C21 O47 R11
    Date: 2011
  13. By: Peter Tillmann (University of Giessen)
    Abstract: The adoption of a credible monetary policy regime such as inflation targeting is known to reduce the persistence of inflation fluctuations. This conclusion, however, is derived from aggregate inflation or sectoral inflation rates, not from regional inflation data. This paper studies the regional dimension of inflation targeting, i.e. the consequences of inflation targeting for regional inflation persistence. Based on data for Korean cities and provinces it is shown that the adoption of inflation targeting leads (i) to a fall in inflation persistence at the regional level and (ii) to a reduction in the cross-regional heterogeneity in inflation persistence. A common factor model lends further support to the role of the common component, and hence monetary policy, for regional inflation persistence.
    Keywords: inflation targeting, inflation persistence, monetary policy regime, regional inflation, factor model
    JEL: E31 E52 R11
    Date: 2011
  14. By: Abe, Yukiko
    Abstract: This study uses cross-sectional data to investigate the regional differences in women's participation in the labor market. Women's participation is high in the northern coastal region of Japan. Their high rate of participation is caused by the fact that married women with children participate as regular full-time eployees. A possible explanation for the high participation in the northern coastal region is a combination of (1) a high degree of manufacturing in the northern coastal region and (2) supply side factors that motivate women to work.
    Keywords: Regional differences, regular employment, part-time employment, Japan
    JEL: J21 R23
    Date: 2011–03
  15. By: Deuss, Annelies
    Keywords: Brazil, sugarcane expansion, economic growth, propensity score, ethanol, Agricultural and Food Policy, Crop Production/Industries, International Development, Research Methods/ Statistical Methods, C14, C21, O13, R13,
    Date: 2011
  16. By: Swindall, Devin C.; Willis, David B.; Boys, Kathryn A.; Hughes, David W.
    Abstract: Supporters claim that entrepreneurship is critical to building and sustaining the regional economies of urban and rural areas across the nation. Proponents argue that economic development practices that enhance and support entrepreneurship are essential because they cultivate innovation which, in turn, creates new jobs, new wealth, and a better quality of life. However, South Carolinaâs real self-employed per capita income has decreased over the last decade. This downward trend highlights the need to examine the drivers of entrepreneurial income. The income of self-employed workers, as opposed to the number of self-employed, is critical to economic development because a major goal of economic policy is to increase incomes not just employment. Identifying and quantifying the personal, cultural, and economic factors that influence self-employed income provides policy makers with another tool to enhance economic development policies. This study uses data from the American Community Survey for South Carolina in both an ordinary regression approach and a quantile regression approach to investigate the relationship between individual entrepreneurial income and individual personal attributes, social/institutional assets available to the entrepreneur, and the regional economic environment the entrepreneur operates within. Personal attributes, such as education and sex, and the importance of self-employed income to total family income are significant variables in explaining income variation among self-employed individuals.
    Keywords: Self-employed income, entrepreneurship, quantile regression, Community/Rural/Urban Development, Consumer/Household Economics, Labor and Human Capital, R11, R12,
    Date: 2011
  17. By: Johnston, Robert J.; Ramachandran, Mahesh; Schultz, Eric T.; Segerson, Kathleen; Besedin, Elena Y.
    Abstract: Stated preference analyses commonly impose strong and unrealistic assumptions in response to spatial welfare heterogeneity. These include spatial homogeneity or continuous distance decay. Despite their ubiquity in the valuation literature, global assumptions such as these have been increasingly abandoned by non-economics disciplines in favor of approaches that allow for spatial patchiness. This paper develops parallel methods to evaluate local patchiness and hot spots in stated preference welfare estimates, characterizing relevant patterns overlooked by traditional approaches. The analysis draws from a choice experiment addressing river restoration. Results demonstrate shortcomings in standard treatments of spatial heterogeneity and insights available through alternative methods.
    Keywords: Willingness to Pay, Hot Spot, Stated Preference, Ecosystem Service, Valuation, Environmental Economics and Policy, Research Methods/ Statistical Methods,
    Date: 2011
  18. By: Kumarappan, Subbu
    Keywords: Agribusiness, Industrial Organization, Research Methods/ Statistical Methods, Resource /Energy Economics and Policy,
    Date: 2011
  19. By: Hernandez-Villafuerte, Karla Vanessa
    Abstract: Selected Paper prepared for presentation at the Agricultural & Applied Economics Associationâs 2011 AAEA & NAREA Joint Annual Meeting, Pittsburgh, Pennsylvania, July 24-26, 2011. (Poster Presentation)
    Keywords: cointegration, price transmission, geographical distance, structural breaks, principal component regression, rice, Brazil., Agricultural and Food Policy, Demand and Price Analysis, C32, Q11, Q13,
    Date: 2011
  20. By: Goodwin, Barry K.; Holt, Matthew T.; Prestemon, Jeffrey P.; Onel, Gulcan
    Abstract: An extensive empirical literature has addressed a wide array of issues pertaining to price linkages over space and across time. Empirical models of price linkages have been used to measure market power and to characterize the operation of markets that are separated by space, time, and product form. The long history of these empirical models extends from simple tests of price correlation, to conventional regression tests, to modern time series models that account for nonstationarity, nonlinearities, and threshold behavior in market linkages. This paper proposes an entirely dierent and potentially novel approach to analyzing these same types of time series data in a nonlinear fashion. Copula-based models that consider the joint distribution of prices separated by space are developed and applied to weekly prices for important lumber products at geographically distinct markets. In particular, we consider prices taken from weekly editions of the Random Lengths publication for homogeneous OSB products.
    Keywords: Spatial Market Linkages, Copula Models, State-dependence, Forest Products, Research Methods/ Statistical Methods,
    Date: 2011–05–03
  21. By: Jordan, Jeffrey; Mykerezi, Elton; Kostandini, Genti; Mills, Bradford
    Keywords: Community/Rural/Urban Development, Labor and Human Capital,
    Date: 2011
  22. By: Lenka Šastná (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Martin Gregor (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic)
    Abstract: We measure cost efficiency of 202 Czech municipalities of extended scope in period 2003-2008. The study is the first application of overall efficiency measurement of the local governments in the new EU member states, and the second in post-communist countries. We measure government efficiency through established quantitative and qualitative indicators of the provision of education, cultural facilities, infrastructure and other local services. First, we employ non-parametric approach of the data envelopment analysis and adjust the efficiency scores by bootstrapping. Second, we employ the stochastic frontier analysis and control for effects of various demographic, economic, and political variables. We compare scores under our preferred specification, i.e. pseudo-translog time-variant stochastic-frontier analysis with determinants, with alternative scores. The determinants that robustly increase inefficiency are population size, distance to the regional center, share of university-educated citizens, capital expenditures, subsidies per capita, and the share of self-generated revenues. Concerning political variables, increase in party concentration and the voters' involvement increases efficiency, and local council with a lower share of left-wing representatives also tend to be more efficient. We interpret determinants both as indicators of slack, non-discretionary inputs, and unobservable outputs. The analysis is conducted also for the period 1994-1996, where political variables appear to influence inefficiency in a structurally different way. From comparison of the two periods, we obtain that small municipalities improve efficiency significantly more that large municipalities.
    Keywords: Public spending efficiency, Data Envelopment Analysis, Stochastic Frontier Analysis, local governments
    JEL: D24 H72
    Date: 2011–05
  23. By: Balli, Faruk; Basher, Syed Abul; Jean Louis, Rosmy
    Abstract: This paper incorporates recent developments in the literature to quantify the amount of interprovincial risk-sharing in Canada. We find that 29% of shocks to gross provincial product are smoothed by capital markets, 27% are smoothed by the federal tax-transfer systems, and about 24% are smoothed by credit markets. The remaining 20% are not smoothed. Our results bring to light the critical role that Alberta plays in trading-off credit market smoothing for more capital market risk-sharing with the rest of Canada. Our pairwise risk-sharing analysis has brought up some interesting questions and arguments that are often neglected in discussions of regional risk-sharing. For example, one aspect of the pairwise analysis sheds light on the assessment of the economic effects of Quebec separation.
    Keywords: Risk-sharing; pairwise risk-sharing; federal taxes and transfer; panel data; cross-sectional dependence.
    JEL: H77 C33 E21 F36
    Date: 2011–05–12

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