nep-geo New Economics Papers
on Economic Geography
Issue of 2011‒08‒29
eighteen papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Application of convergence theories and new economic geography in Portugal. Differences and similarities By Martinho, Vítor João Pereira Domingues
  2. Measuring regional environmental efficiency: A directional distance function approach By Halkos, George; Tzeremes, Nickolaos
  3. Analyse der Berücksichtigung eines Wanderungsindikators im Rahmen der Abgrenzung des GRW-Fördergebiets : Gutachten für die Gemeinschaftsaufgabe "Verbesserung der regionalen Wirtschaftsstruktur" im Auftrag des Hessischen Ministeriums für Wirtschaft, Verkehr und Landesentwicklung By Buch, Tanja; Hamann, Silke; Meier, Henning; Niebuhr, Annekatrin; Peters, Cornelius; Puckelwald, Johannes
  4. Appropriate policy measures to attract private capital in consideration of regional efficiency in using infrastructure and human capital By Schaffer, Axel
  5. Forms of Emergence and the Evolution of Economic Landscapes By Ron Martin; Peter Sunley
  6. Measuring Regional Economic Impacts from Wildfire: Case Study of Southeast Oregon Cattle-Ranching Business By Man-Keun Kim; Erqian Julia Zhu; Thomas R. Harris; Jonathan E. Alevy
  7. The role of public services and taxes in attracting ‘foreign’ direct investment By Timothy J. Goodspeed; Jorge Martinez-Vazquez; Li Zhang
  8. Interregional input-ouptut system for Ecuador, 2007: methodology and results By Haddad, Eduardo A.; Garcia Samaniego, Juan Manuel; Porsse, Alexandre A.; Ochoa Jimenez, Diego Alejandro; Ochoa Moreno, Wilman Santiago; Souza, Luiz Gustavo Antonio
  9. Metropolitan Regions: Preconditions and Strategies for Growth and Development in the Global Economy By Klaesson, Johan; Johansson, Börje; Karlsson, Charlie
  10. Domestic tourism and regional inequality in Brazil By Haddad, Eduardo A.; Porsse, Alexandre A.; Rabahy, Wilson
  11. Why Have Poorer Neighbourhoods Stagnated Economically, While the Richer have Flourished? Neighbourhood Income Inequality in Canadian Cities By Chen, W. H.; Myles, John; Picot, Garnett
  12. Estimação das Elasticidades de Substituição do Comércio Regional do Brasil By Faria, Weslem Rodrigues; Haddad, Eduardo A.
  13. On the Optimal Design of Disaster Insurance in a Federation By Timothy J. Goodspeed; Andrew Haughwout
  14. Abgrenzung und Analyse von Software Clustern am Beispiel der Region Rhein-Main-Neckar By Hahn, Markus; Kaiser, Jasmin; Ostwald, Dennis Alexander; Buxmann, Peter
  15. Beyond Marshallian Agglomeration Economies: The Roles of the Local Trade Association in a Meiji Japan Weaving District (1868-1912) By Tomoko Hashino; Takafumi Kurosawa
  16. Los docentes, las escuelas y los aprendizajes escolares en América Latina: Un estudio regional usando la base de datos del SERCE By Jesús Duarte; María Soledad Bos; Martín Moreno
  17. Restoring Fiscal Sustainability in Spain By Pierre Beynet; Andrés Fuentes; Robert Gillingham; Robert Hagemann
  18. To Move or not to Move: What Drives Residential Mobility Rates in the OECD? By Aida Caldera Sánchez; Dan Andrews

  1. By: Martinho, Vítor João Pereira Domingues
    Abstract: The aim of this paper is to present a further contribution, with panel data, to the analysis of absolute convergence, associated with the neoclassical theory, and conditional, associated with endogenous growth theory, of the sectoral productivity at regional level (NUTs III, from 1995 to 1999). They are also presented empirical evidence of conditional convergence of productivity, for each of the economic sectors of the NUTS II of Portugal, from 1995 to 1999. The structural variables used in the analysis of conditional convergence is the ratio of capital/output, the flow of goods/output and location ratio. With this work we try, also, to analyse the agglomeration process in the Portuguese regions, using the New Economic Geography models.
    Keywords: convergence; new economic geography; Portuguese regions
    JEL: O18 C23 R12
    Date: 2011
  2. By: Halkos, George; Tzeremes, Nickolaos
    Abstract: This paper by applying a directional distance function approach measures the UK regions’ municipality waste performance. In addition the paper constructs conditional stochastic kernels trying to determine nonparametrically the association of regions’ GDP per capita levels with their calculated regional environmental efficiencies. There are evidences of regional environmental inefficiencies for the majority of UK regions regardless their regional GDP per capita levels.
    Keywords: Regional environmental performance; Directional distance function; Conditional stochastic kernel
    JEL: C6 Q5 O13
    Date: 2011
  3. By: Buch, Tanja (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Hamann, Silke (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Meier, Henning (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Niebuhr, Annekatrin (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Peters, Cornelius (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Puckelwald, Johannes (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "The Joint Task 'Improvement of the Regional Economic Structure' delimits the German promotion areas. For this purpose different indicators reflecting the labor market situation and regional income are linked. So far, no indicator is considered that indicates the demographic change of regions. The Institute for Employment Research was commissioned to produce an expert report on the question if inclusion of a migration indicator could give further information about demographic and other aspects concerning the regional labor market situation. This paper presents the results of the analysis which was financed by the Ministry of economics, transport, urban and regional development of the State of Hesse. We examine the effects of additionally considering migration to determine the contour of the assisted area theoretically as well as in a simulation model. There is some evidence that the inclusion of a migration indicator in the comprehensive model leads to some additional information on regional problems." (Author's abstract, IAB-Doku) ((en))
    Date: 2011–08–04
  4. By: Schaffer, Axel
    Abstract: Regional economic policy disposes of two principal options to attract private capital, which in turn helps to safeguard employment and to foster regional growth. On the one hand, regional policy could seek to enhance a region's level of public capital (e.g. transport infrastructure), which as a consequence makes the region more attractive to private investors in general. On the other hand, private capital could be attracted in a more direct way by proposing specific innovation, SME or cluster programs. The success of both options is partly driven by the regions already existing level of region specific production factors and the ability to use these factors efficiently. Indirect approaches to attract private capital seem to be particularly promising for efficient regions (no matter of the absolute level of public capital). In contrast, inefficient regions shall benefit more from specific programs. However, for Germany the factual pattern seems to be the other way around, which could widening rather than closing the income gap among regions. --
    Date: 2011
  5. By: Ron Martin; Peter Sunley
    Abstract: Over the past two decades, the notion of ÔemergenceÕ has attracted increasing attention and controversy across the social sciences, as par of a growing interest in the applicability of complexity theory to socio-economic-political systems. Within this context, as economic geographers, our concern in this paper is with the usefulness of the idea of emergence for studying the economic landscape and its evolution. We examine three ÔordersÕ of emergence, and focus attention especially on the third type, Ôdevelopmental or evolutionaryÕ emergence. Despite its limitations, the notion of third order emergence is a potentially valuable organizing concept in economic geography. It provides a framework for exploring how it is that the spatial forms of the economy - clusters, regions, firm networks and so on Ð are recursively related to economic action.
    Keywords: Emergence, Supervenience, Downward causation, Evolution, Economic landscape
    JEL: B15 R11 R12
    Date: 2011–08
  6. By: Man-Keun Kim (Department of Applied Economics, Utah State University); Erqian Julia Zhu (Department of Finance, Beijing Language and Culture University); Thomas R. Harris (Department of Resource Economics, University of Nevada Reno); Jonathan E. Alevy (Department of Economics, University of Alaska Anchorage)
    Keywords: public grazing, regional economic impact, Social Accounting Matrix, Southeast Oregon, wildfire
    Date: 2011
  7. By: Timothy J. Goodspeed (Hunter College); Jorge Martinez-Vazquez (Georgia State University); Li Zhang (Central University of Finance and Economics, China)
    Abstract: The main thesis of this paper is that in setting budget and regional development policies, public officials at the regional and central government levels must internalize that businesses are quite unlikely to be willing to pay taxes that are not matched by their desired level and quality of public services. Thus the adequate provision of public services, and not just low taxes, would seem to be an important characteristic of regions or countries that want to attract FDI. In particular, relatively higher regional or national taxes may be acceptable or even competitive if investors see them compensated or offset by higher levels and quality of public services and infrastructure. Indeed, the local public finance and regional economics literature has traditionally emphasized the impact that local taxation and spending have on the location decisions of mobile households and businesses. At the international level, we empirically test this by using a panel data set 53 developing and developed countries in different regions of the world, spanning the period 1984-2002. The regression results generally indicate that government quality and private sector quality positively influence inflows of FDI, although the results differ somewhat for developing and developed countries. At the regional level within a country, we also find supporting evidence that the provision of public services level also matter for the direction and level of FDI flows. This comes to confirm many similar findings in the regional-local empirical public finance that have tested the Tiebout hypothesis.
    Keywords: FDI location, public services
    JEL: H87 H25 K10
    Date: 2011
  8. By: Haddad, Eduardo A.; Garcia Samaniego, Juan Manuel; Porsse, Alexandre A.; Ochoa Jimenez, Diego Alejandro; Ochoa Moreno, Wilman Santiago; Souza, Luiz Gustavo Antonio
    Abstract: In this paper, we explore the structural characteristics of the interregional input-output system developed for Ecuador for the year 2007. As part of an ongoing project that aims to develop an interregional CGE model for the country, this database was developed under conditions of limited information. It provides the opportunity to better understand the spatial linkage structure associated with the national economy in the context of its 22 provinces, 15 sectors and 60 different products. This exploratory analysis is based on the description of structural coefficients and the use of traditional input-output techniques. Finally, we further explore the spatial linkage structure by looking at the regional decomposition of final demand. It is hoped that this exercise might result in a better appreciation of a broader set of dimensions that might improve our understanding of the integrated interregional economic system in Ecuador.
    Keywords: Interregional input-output model; Ecuador; spatial linkages
    JEL: D57 R15 R12 R34 C67
    Date: 2011
  9. By: Klaesson, Johan (Jönköping International Business School); Johansson, Börje (Jönköping International Business School and Royal Institute of Technology); Karlsson, Charlie (Jönköping International Business School, Blekinge Institute of Technology, Karlskrona and University West, Trollhättan)
    Abstract: The importance of metropolitan regions as national growth and development engines, and in particular as driving forces in national as well as global innovation processes is well recognized. This paper highlights the role of metropolitan regions in different contexts in order to lay a foundation for future research on metropolitan regions and their development. Specifically, the paper dwells on the role of metropolitan regions as nodes in national and international networks and as nodes of knowledge generation and innovation. Further, market potential as a concept describing the economic concentration to and the opportunities of making contacts within and between metropolitan regions is introduced. Additionally, the internal dynamic of metropolitan regions and the role of fast and slow processes is described. Lastly this paper illustrates how the input and output market potentials represent factors that adjust slowly and that play the same role for metropolitan development as metropolitan infrastructure.
    Keywords: Metropolitan regions; market potential; networks
    JEL: O18 O31 R11 R12
    Date: 2011–08–17
  10. By: Haddad, Eduardo A.; Porsse, Alexandre A.; Rabahy, Wilson
    Abstract: This paper analyzes the consumption patterns of tourists coming from different domestic origins and choosing other domestic destinations in Brazil, in terms of expenditure level and composition. We also look at the different alternatives of financing tourist expenditures and their implications for the net multipliers in an integrated framework. We use survey data for domestic tourism in Brazil to consolidate an interregional matrix of expenditures by tourists and then use an interregional input-output system for Brazil to compute the tourism multiplier effects based on alternative hypotheses for the sources of financing of expenditures by tourists. The results are analyzed, and their implications for regional inequality in the country are discussed.
    Keywords: regional impact analysis of tourism; interregional input-output model; tourist expenditure multipliers; domestic tourism; regional inequality; Brazil
    JEL: R13 R15 R12 L83
    Date: 2011
  11. By: Chen, W. H.; Myles, John; Picot, Garnett
    Abstract: Higher income neighbourhoods in Canada’s eight largest cities flourished economically during the past quarter century, while lower income communities stagnated. This paper identifies some of the underlying processes that led to this outcome. Increasing family income inequality drove much of the rise in neighbourhood inequality. Increased spatial economic segregation, the increasing tendency of “like to live nearby likeâ€, also played a role. In the end, the differential economic outcomes between richer and poorer neighbourhoods originated in the labour market, or in family formation patterns. Changes in investment, pension income, or government transfers played a very minor role. But it was not unemployment that differentiated the richer from poorer neighbourhoods. Rather, it was the type of job found, particularly the annual earnings generated. The end result has been little improvement in economic resources in poor neighbourhoods during a period of substantial economic growth, and a rise in neighbourhood income inequality.
    Keywords: Inequality, Neighbourhood, Poverty
    JEL: R23 J31
    Date: 2011–08–21
  12. By: Faria, Weslem Rodrigues; Haddad, Eduardo A.
    Abstract: This study estimates elasticities of regional trade in Brazil considering 110 products and 558 regions. For this, a large database was generated, becoming one of the most important stages in the trajectory of the study given the highly intensive procedures performed to obtain the final interregional trade flows. The elasticities were estimated using the Armington (1969) model, adapted from Bilgic’s (2002) suggestion regarding the definition of variables. Few studies were identified in the literature that aimed at estimating elasticities of substitution in regional trade, adding relative importance to this study. This fact may be related to the generation of the database because of the non-triviality in the numerous requirements and specific information of the economy. The estimation results presented, in general, coefficients with expected signs and the elasticities changed according to the types of products. Products related to agricultural and mining activities had less elastic coefficients than the coefficients of the service activities. The products related to industrial activities presented jointly an average coefficient equal to -1.775.
    Keywords: Armington elasticity; regional trade
    JEL: R12
    Date: 2011
  13. By: Timothy J. Goodspeed (Hunter College); Andrew Haughwout (Federal Reserve Bank of New York)
    Abstract: Recent experience with disasters and terrorist attacks in the US indicates that state and local governments rely on the federal sector for support after disasters occur. But these same governments invest in infrastructure designed to reduce vulnerability to natural and man-made hazards. We show that when the federal government is committed to full insurance against disasters, regions will have incentives to under-invest in ex-ante protective measures. We derive the structure of the optimal second-best insurance system when regional governments choose investment levels non-cooperatively and the central government cannot verify regional investment choices. For low probability disasters this will result in lower ex-post intergovernmental transfers (and hence less ex-post redistribution) and greater ex-ante investment. However, the second-best transfer scheme suffers from a time-inconsistency problem. Ex-post, the central government will be driven towards full insurance rather than the second-best grants, which results in a type of soft budget constraint problem. Sub-national governments will anticipate this and reduce their investment in protective infrastructure even further. The result is that the central government may be better off suffering the underinvestment that results with first-best transfers because investment is even lower under second-best transfers when the central government is unable to commit.
    Keywords: intergovernmental transfers, natural disasters, federalism, risk sharing
    JEL: H11 H7 R5
    Date: 2011
  14. By: Hahn, Markus; Kaiser, Jasmin; Ostwald, Dennis Alexander; Buxmann, Peter
    Abstract: In diesem Artikel wird ein multimethodischer Ansatz vorgestellt, der der Abgrenzung und Analyse von Software-Clustern auf Basis volkswirtschaftlicher Daten dient. Zunächst wird im Rahmen eines quantitativen Top-down-Ansatzes das Gründungsgeschehen, die Bruttowertschöpfung sowie die räumliche Ballung von Be-trieben und Beschäftigen ausgewertet und am Beispiel des Soft-ware-Clusters Rhein Main Neckar den bislang verwendeten Ab-grenzungen gegenübergestellt. Im Anschluss werden die so er-haltenen Ergebnisse mittels eines qualitativen Bottom-up-Ansatzes durch eine empirische Analyse überprüft und die ge-wonnenen Erkenntnisse miteinander verglichen.
    Keywords: Agglomeration, Cluster, Software Industry
    Date: 2011–08
  15. By: Tomoko Hashino (Graduate School of Economics, Kobe University/ Department of History, George Washington University); Takafumi Kurosawa (Graduate School of Economics, Kyoto University)
    Abstract: Recent studies have shown that economic development based on industrial districts or clusters is common not only in the Western nations but also among many developing countries, as Marshall might have anticipated. Similarly, in the development process of modern Japan, many industrial districts developed in various industries. Interestingly, they were much more organized and institutionalized than Marshall described. This article demonstrates that local trade associations had an important role in enhancing Marshallian externalities by facilitating joint actions for the supply of public goods, such as the creation of glocal district brandsh and provision of technological and market information. In this article, we consider the case of Kiryu, which was one of the oldest and best-known silk weaving districts in modern Japan.
    Keywords: industrial district, industrial cluster, weaving industry, local trade association, joint action, modern Japan
    Date: 2011–08
  16. By: Jesús Duarte; María Soledad Bos; Martín Moreno
    Abstract: Este estudio busca identificar factores escolares que se asocian con los aprendizajes de los alumnos en América Latina, en particular aquellos relacionados con los docentes y el contexto escolar en el que ejercen la docencia. Utilizando modelos de regresión multinivel y la base de datos del SERCE, identifica un grupo de factores escolares que tienen potencial de mejorar la calidad y la equidad de la educación en la región. Entre las características de los docentes asociadas con la calidad se presenta la edad, la experiencia, el nivel educativo y la cercanía de su vivienda al centro escolar. La manera como son contratados los docentes, el tipo de contrato que sostienen con la escuela o con el sector, o tener empleos adicionales, no presentan asociaciones significativas con los aprendizajes escolares. En cambio, el tiempo efectivo que le dedican los docentes a enseñar, o la jornada completa, y la dotación de libros y material educativo están altamente relacionados con los puntajes de los estudiantes en las pruebas. Las escuelas con mejores facilidades físicas y con buenos servicios de agua, acueducto, electricidad y teléfono también tienen una clara ventaja en las pruebas de los alumnos, independiente del nivel socioeconómico de las familias que atienden.
    Date: 2010–09
  17. By: Pierre Beynet; Andrés Fuentes; Robert Gillingham; Robert Hagemann
    Abstract: Spain’s government has introduced ambitious consolidation measures, which should yield a sizeable improvement in discretionary fiscal efforts. Should budgetary outcomes fall short of targets, the government should stand ready to introduce further measures, as announced. Such measures could include subjecting more goods and services to the standard value added tax rate. They could also be used to fund a reduction in some social security contributions paid by employers. Once sufficient progress towards fiscal consolidation has been achieved, a further reform of the tax system towards more growth-friendly taxes should be contemplated. Spain also faces a dramatic increase in ageing-related public spending, mostly on account of pensions. The pension reform plan is welcome, but further reforms in the pension system will be necessary to contain expenditure growth. Rules on the budget balances for each level of government should be reviewed so as to induce regional governments to run larger budget surpluses when activity exceeds potential.<P>Rétablir la viabilité budgétaire en Espagne<BR>Le gouvernement espagnol a introduit des mesures d’assainissement budgétaire ambitieuses qui devraient produire une amélioration importante des efforts budgétaires discrétionnaires. Dans le cas où les objectifs budgétaires ne seraient pas atteints, les autorités devront se tenir prêtes, comme annoncé, à prendre des mesures supplémentaires, qui pourraient consister à assujettir davantage de produits et de services au taux ordinaire de la taxe sur la valeur ajoutée. Ces mesures pourraient aussi servir à financer la réduction d’une partie des cotisations patronales de sécurité sociale. Une fois la consolidation budgétaire suffisamment avancée, une nouvelle réforme du système fiscal devra être envisagée en vue de mettre davantage l’accent sur les impôts qui favorisent la croissance. L’Espagne se trouve aussi confrontée à une augmentation spectaculaire des dépenses publiques liées au vieillissement, due pour l’essentiel aux retraites. Le plan de réforme des retraites va dans le bon sens mais des réformes plus poussées du système de retraite seront nécessaires pour contenir l’accroissement des dépenses. Il conviendrait de revoir les règles relatives aux soldes budgétaires des différents niveaux d’administration afin d’inciter les autorités régionales à dégager des excédents budgétaires plus importants lorsque l’activité économique est supérieure au potentiel.
    Keywords: taxation, fiscal policy, fiscal federalism, pension reform, fiscal sustainability, Spain, discretionary fiscal effort, fiscalité, politique budgétaire, fédéralisme budgétaire, viabilité budgétaire, Espagne, effort budgétaire discrétionnaire, réforme des retraites
    JEL: H20 H21 H53 H55 H60 H77
    Date: 2011–03–18
  18. By: Aida Caldera Sánchez; Dan Andrews
    Abstract: Residential mobility is closely tied to housing market forces and has important implications for labour mobility and the efficient allocation of resources across the economy. This paper analyses patterns of residential mobility across OECD countries and the role of housing policies in enhancing or hampering residential mobility. Based on cross-sectional household data for 25 countries, the results suggest that differences in residential mobility across countries are partially related to differences in public policies. After controlling for household and country-specific characteristics, residential mobility is higher in countries with lower transaction costs, more responsive housing supply, lower rent controls and tenant protection. Residential mobility tends also to be higher in environments with greater access to credit, suggesting that financial deregulation – by lowering borrowing costs and facilitating access to mortgage finance – facilitates mobility. This cross-country evidence is supported by city and state-level evidence for the United States, which also highlights the potential risks that high leverage rates pose to residential mobility.<P>Déménager ou ne pas déménager : quels sont les déterminants des taux de mobilité résidentielle dans l'OCDE?<BR>La mobilité résidentielle est étroitement liée aux dynamiques du marché du logement et a des implications importantes pour la mobilité professionnelle et la répartition efficace des ressources dans l'économie. Ce document analyse les tendances de la mobilité résidentielle dans les pays de l'OCDE et le rôle des politiques du logement dans le renforcement ou l?obstruction de la mobilité résidentielle. Sur la base des enquêtes auprès des ménages pour 25 pays, les résultats indiquent que les différences dans la mobilité résidentielle entre les pays sont en partie liées aux différentes politiques des gouvernements. Après avoir contrôlé pour les caractéristiques du ménage et celles propres à chaque pays, la mobilité résidentielle est plus élevée dans les pays où les coûts de transaction, le contrôle des loyers et la protection des locataires sont plus faibles, et l'offre de logements plus elevée. La mobilité résidentielle est aussi plus élevée dans les environnements avec un plus grand accès au crédit, ce qui suggère que la déréglementation financière - en réduisant les coûts d'emprunt et en facilitant l'accès au financement hypothécaire - facilite la mobilité. Ces résultats sont soutenus par une analyse au niveau ville et États pour les États-Unis, qui met également en évidence les risques potentiels que posent un taux d'endettement élevé à la mobilité résidentielle.
    Keywords: housing market, residential mobility, transaction costs, rental market regulations, coût de transition, mobilité résidentielle, régulation du marché locataire, marché du logement
    JEL: H20 R21 R23 R34 R38
    Date: 2011–02–18

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