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on Economic Geography |
| By: | Raffaele Paci; Emanuela Marrocu |
| Abstract: | Regional competitiveness, especially in the industrialised countries, is increasingly reliant on the availability of an adequate endowment of knowledge assets at the local level, like technological and human capital. These intangible factors enhance regional efficiency directly as inputs of the production function, but they also play a crucial role in allowing the territory to absorb the potential knowledge spillovers from the neighbouring regions. The aim of this paper is to analyse the role of the internal and external factors in determining the productivity level for a large set of regions belonging to the EU27 plus Norway and Switzerland. We estimate a Cobb-Douglas production function over the period 2000-2008 where, in addition to the traditional inputs of physical capital and units of labour, we consider innovation activities and human capital endowments as relevant knowledge assets. We also control for other geographical and industrial features of the regions. In order to take into account the commonly found geographic association across regions, our analysis is carried out within the spatial panel econometric framework. Main results, robust to a wide array of sensitivity checks, show that knowledge assets exhibit positive and significant coefficients and the impact of human capital on GDP is higher than the one found for technological capital in most of the estimated empirical models. Moreover, we find evidence of spatial spillovers directly associated with the two immaterial assets, which turn out to be much more effective in the regions of the 12 new accession countries with respect to all other European regions. The significant presence of such spillovers emphasizes the important role played by highly educated labour forces in increasing the regions’ absorptive capacity of new external knowledge and in ensuring its effective use in the production process. |
| Keywords: | knowledge; innovation; human capital; production function; spatial spillovers; European regions |
| JEL: | C23 O33 R11 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201213&r=geo |
| By: | William R. Kerr; Scott Duke Kominers |
| Abstract: | We model spatial clusters of similar firms. Our model highlights how agglomerative forces lead to localized, individual connections among firms, while interaction costs generate a defined distance over which attraction forces operate. Overlapping firm interactions yield agglomeration clusters that are much larger than the underlying agglomerative forces themselves. Empirically, we demonstrate that our model’s assumptions are present in the structure of technology and labor flows within Silicon Valley and its surrounding areas. Our model further identifies how the lengths over which agglomerative forces operate influence the shapes and sizes of industrial clusters; we confirm these predictions using variations across both technology clusters and industry agglomeration. |
| Keywords: | CES,economic,research,micro,data,microdata, agglomeration, clusters, industrial organization, Silicon Valley, entrepreneurship, labor markets, technology flows, patents, natural advantages |
| JEL: | J2 J6 L1 L2 L6 O3 R1 R3 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:12-09&r=geo |
| By: | Pim Heijnen (University of Groningen); Marco A. Haan (University of Groningen); Adriaan R. Soetevent (University of Amsterdam) |
| Abstract: | We develop a method to screen for local cartels. We first test whether there is statistical evidence of clustering of outlets that score high on some characteristic that is consistent with collusive behavior. If so, we determine in a second step the most suspicious regions where further antitrust investigation would be warranted. We apply our method to build a variance screen for the Dutch gasoline market. |
| Keywords: | collusion; variance screen; spatial statistics; K-function |
| JEL: | C11 D40 L12 L41 |
| Date: | 2012–06–18 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20120058&r=geo |
| By: | Donald R. Davis; Jonathan I. Dingel |
| Abstract: | Leading empiricists and theorists of cities have recently argued that the generation and exchange of ideas must play a more central role in the analysis of cities. This paper develops the first system of cities model with costly idea exchange as the agglomeration force. Our model replicates a broad set of established facts about the cross section of cities. It provides the first spatial equilibrium theory of why skill premia are higher in larger cities, how variation in these premia emerges from symmetric fundamentals, and why skilled workers have higher migration rates than unskilled workers when both are fully mobile. |
| JEL: | F1 F22 J24 J61 R1 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18188&r=geo |
| By: | Victor Aguirregabiria; Gustavo Vicentini |
| Abstract: | We propose a dynamic model of an oligopoly industry characterized by spatial competition between multi-store retailers. Firms compete in prices and decide where to open or close stores depending on demand conditions and the number of competitors at different locations, and on location-specific private-information shocks. We develop an algorithm to approximate a Markov Perfect Equilibrium in our model, and propose a procedure for the estimation of the parameters of the model using panel data on number of stores, prices, and quantities at multiple geographic locations within a city. We also present numerical examples to illustrate the model and algorithm. |
| Keywords: | Spatial competition; Store location; Industry dynamics; Sunk costs. |
| JEL: | C73 L13 L81 R10 R30 |
| Date: | 2012–06–14 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-457&r=geo |
| By: | Berliant, Marcus; Tabuchi, Takatoshi |
| Abstract: | We consider information aggregation in national and local elections when voters are mobile and might sort themselves into local districts. Using a standard model of private information for voters in elections in combination with a New Economic Geography model, agglomeration occurs for economic reasons whereas voter stratification occurs due to political preferences. We compare a national election, where full information equivalence is attained, with local elections in a three-district model. We show that full information equivalence holds at a stable equilibrium in only one of the three districts when transportation cost is low. The important comparative static is that full information equivalence is a casualty of free trade. When trade is more costly, people tend to agglomerate for economic reasons, resulting in full information equivalence in the political sector. Under free trade, people sort themselves into districts, most of which are polarized, resulting in no full information equivalence in these districts. We examine the implications of the model using data on corruption in the legislature of the state of Alabama and in the Japanese Diet. |
| Keywords: | information aggregation in elections; informative voting; new economic geography; local politics |
| JEL: | D82 D72 R12 |
| Date: | 2012–06–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39596&r=geo |
| By: | Richard Harris; John Moffat |
| Abstract: | This paper decomposes aggregate TFP growth in Britain for 1997-2008 to show the contribution of different LEPs and the role played by manufacturing and services and UK- and foreign-owned plants within these LEPs. These contributions are further decomposed to show the role of productivity growth in continuing plants vis-à-vis reallocations in output shares. The results show that the largest LEPs, in population terms, with higher levels of job density, greater reliance on manufacturing and skilled worker occupations, higher proportions of workers with NVQ4+ qualifications, and lower turnover of businesses, achieved the highest TFP growth. This strong performance is mostly the result of reallocations of output shares towards high productivity continuing plants and the opening of high productivity plants. |
| Keywords: | Productivity decomposition, regional productivity growth |
| JEL: | C23 D24 R12 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:cep:sercdp:0112&r=geo |
| By: | Bram Timmermans; Ron Boschma |
| Abstract: | This paper investigates the impact of labour mobility on plant performance in Denmark. Our study shows that the effect of labour mobility can only be assessed when one accounts for the type of skills that flow into the plant, and the degree to which these match the existing skills at the plant level. As expected, we found that the inflow of skills that are related to skills in the plant impacts positively on plant productivity growth, while inflows of skills that are similar to the plant skills have a negative effect. We used a sophisticated indicator of revealed relatedness that measures the degree of skill relatedness between sectors on the basis of the intensity of labour flows between sectors. Intra-regional mobility of skilled labour had a negative effect on plant performance, but the impacts of intra- and inter-regional mobility depended on the type of skills that flow into the plant. |
| Keywords: | labour mobility, revealed relatedness, plant performance, geographical proximity, related labour flows, Denmark |
| JEL: | J61 R11 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1213&r=geo |
| By: | Martinho, Vítor João Pereira Domingues |
| Abstract: | With this work it is intended to analyze the contributions of the Keynesian theory to the explanation of the regional evolution in Portugal. Considering the Keynesian models in different perspectives and taking into account the Verdoorn (1949) relationship it is did data and econometric analysis for the Portuguese economy in the period from 1995 to 1999. There are not many or none works based in the Keynesian theory and in the Verdoorn relationship for Portugal, namely at regional level. On the other hand the models based in this theory are regularly used to explain the regional economic growth in many countries. So, it is thought that analyze the economic Portuguese context with this theory is an important contribution to the economic theory and to the Portuguese understanding. As main conclusion it can be said that the Keynesian theory show for Portugal, in this period, regional and sectoral divergence. -- |
| Keywords: | Keynesian theory,Verdoorn law,Portuguese regions |
| JEL: | O18 C23 |
| Date: | 2012–06–18 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:59007&r=geo |
| By: | Naomi Hausman |
| Abstract: | Universities, often situated at the center of innovative clusters, are believed to be important drivers of local economic growth. This paper identifies the extent to which U.S. universities stimulate nearby economic activity using the interaction of a national shock to the spread of innovation from universities - the Bayh-Dole Act of 1980 - with pre-determined variation both within a university in academic strengths and across universities in federal research funding. Using longitudinal establishment-level data from the Census, I find that longrun employment and payroll per worker around universities rise particularly rapidly after Bayh-Dole in industries more closely related to local university innovative strengths. The impact of university innovation increases with geographic proximity to the university. Counties surrounding universities that received more pre-Bayh-Dole federal funding - particularly from the Department of Defense and the National Institutes of Health - experienced faster employment growth after the law. Entering establishments - in particular multi-unit firm expansions - over the period from 1977 to 1997 were especially important in generating long-run employment growth, while incumbents experienced modest declines, consistent with creative destruction. Suggestive of their complementarities with universities, large establishments contributed more substantially to the total 20-year growth effect than did small establishments. |
| Keywords: | CES,economic,research,micro,data,microdata, clusters, innovation, local economic growth, universities |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:12-10&r=geo |
| By: | Jens Kolbe; Rainer Schulz; Martin Wersing; Axel Werwatz |
| Abstract: | The price for a single-family house depends both on the characteristics of the building and on its location. We propose a novel semiparametric method to extract location values from house prices. After splitting house prices into building and land components, location values are estimated with adaptive weight smoothing. The adaptive estimator requires neither strong smoothness assumptions nor local symmetry. We apply the method to house transactions from Berlin, Germany. The estimated surface of location values is highly correlated with expert-based land values and location ratings. The semiparametric method can therefore be used for applications where no other location value information exists or where this information is not reliable. |
| Keywords: | Location value, adaptive weight smoothing, spatial modeling |
| JEL: | R31 C14 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1216&r=geo |
| By: | Peter Simmons; Yuan Yuan Xie |
| Abstract: | Guangdong is one of the fastest growing Chinese provinces and has a high level of gross migration flows. Its intra-province migration is 2.7 times higher than its inter-province migration. We study migration between the 18 prefecture-level divisions of Guangdong during 1990-1999 using annual data. In our framework, migration decisions are based on differences in five characteristics between origin and destination: expected urban wage, marriage opportunities, urbanisation and (to reflect profitability of self employed migrants) population and capital stock. We formulate a panel regression equation allowing for both panel heteroscedasticity and inter-cities heterogeneity in the migration process. Remarkably we find that there is a high degree of homogeneity between cities, the only differences being in the impacts of capital stock and degree of urbanisation. Even here, nearly 70% of cities have identical effects. Despite the high level of net migration demonstrated to be largely caused by the above characteristics, intercity inequalities as measured by some of these forces has been growing over our time period. This suggests that a locational equilibrium has not yet been achieved. |
| Keywords: | Intra-provincial migration; intercity inequalities; multivariate choices; equilibrium. |
| JEL: | J61 O15 R23 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:yor:yorken:12/16&r=geo |