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on Economic Geography |
| By: | Ferdinand Rauch; Guy Michaels; Stephen J. Redding |
| Abstract: | We develop a new methodology for quantifying the tasks undertaken within occupations using 3,000 verbs from around 12,000 occupational descriptions in the Dictionary of Occupational Titles (DOTs). Using micro-data from the United States from 1880-2000, we find an increase in the employment share of interactive occupations within sectors over time that is larger in metro areas than non-metro areas. We provide evidence that this increase in the interactiveness of employment is related to the dissemination of improvements in transport and communication technologies. Our findings highlight a change in the nature of agglomeration over time towards an increased emphasis on human interaction. |
| Keywords: | Economic development, human interaction, urbanization |
| JEL: | N92 O18 R12 |
| Date: | 2013–01–11 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:638&r=geo |
| By: | Arvis, Jean-François |
| Abstract: | This paper revisits the ubiquitous bi-proportional gravity model and investigates the reasons why different theoretical frameworks may lead to the same empirical formula.The generic gravity equation possesses scale invariance symmetries that constrain possible theoretical explanations based on optimal allocation principles, such as neoclassical or probabilistic frameworks. These constraints imply that a representative consumer's utilities must be separable, and that an entropy model is the only consistent maximum likelihood allocation of a matrix of flows between origin and destination. The paper explores the feasibility of wider classes of non-scale invariant gravity equations, where gravity is no longer bi-proportional by including nonlinear interactions between trade costs and fundamental country factors such as economic size. It shows that such extensions are feasible but that they do not result in a significant improvement in the explanatory power of the empirical analysis. |
| Keywords: | Economic Theory&Research,Free Trade,Transport Economics Policy&Planning,Geographical Information Systems,Trade Law |
| Date: | 2013–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6347&r=geo |
| By: | Liesenfeld, Roman; Richard, Jean-François; Vogler, Jan |
| Abstract: | In this paper we consider ML estimation for a broad class of parameter-driven models for discrete dependent variables with spatial correlation. Under this class of models, which includes spatial discrete choice models, spatial Tobit models and spatial count data models, the dependent variable is driven by a latent stochastic state variable which is specified as a linear spatial regression model. The likelihood is a high-dimensional integral whose dimension depends on the sample size. For its evaluation we propose to use efficient importance sampling (EIS). The specific spatial EIS implementation we develop exploits the sparsity of the precision (or covariance) matrix of the errors in the reduced-form state equation typically encountered in spatial settings, which keeps numerically accurate EIS likelihood evaluation computationally feasible even for large sample sizes. The proposed ML approach based upon spatial EIS is illustrated with estimation of a spatial probit for US presidential voting decisions and spatial count data models (Poisson and Negbin) for firm location choices. -- |
| Keywords: | Count data models,Discrete choice models,Firm location choice,Importance sampling,Monte Carlo integration,Spatial econometrics |
| JEL: | C15 C21 C25 D22 R12 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cauewp:201301&r=geo |
| By: | B. VERHELST; D. VAN DEN POEL |
| Abstract: | Using scanner data from a large European retailer, this paper empirically assesses deep habit formation in consumption. Deep habit formation constitutes a possible source of price stickiness and helps to mimic procyclical labour and real wage dynamics that are present in macro data. To gauge the existence and the extent of deep habits in consumption, we estimate a dynamic timespace simultaneous model for consumption expenditure at different levels of product aggregation. This spatial panel model enables us to test for both internal and external deep habit formation at the same time. The former captures inertia or persistence in consumption, and is included in the empirical specification as a time lag. The latter captures preference interdependence across households and is captured by a spatial lag. Our results show mixed evidence with respect to internal habit formation, whereas the external habit effect is almost always positive and significant. |
| Keywords: | Deep habits, Preference interdependence, Spatial panel |
| JEL: | C33 C38 D12 L14 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:12/823&r=geo |
| By: | P. BAECKE; D. VAN DEN POEL |
| Abstract: | Traditional CRM models often ignore the correlation that could exist among the purchasing behavior of surrounding prospects. Hence, a generalized linear autologistic regression model can be used to capture this interdependence and improve the predictive performance of the model. In particular, customer acquisition models can benefit from this. These models often suffer from a lack of data quality due to the limited amount of information available about potential new customers. Based on a customer acquisition model of a Japanese automobile brand, this study shows that the extra value resulting from incorporating neighborhood effects can vary significantly depending on the granularity level on which the neighborhoods are composed. A model based on a granularity level that is too coarse or too fine will incorporate too much or too little interdependence resulting in a less than optimal predictive improvement. Since neighborhood effects can have several sources (i.e. social influence, homophily and exogeneous shocks), this study suggests that the autocorrelation can be divided into several parts, each optimally measured at a different level of granularity. Therefore, a model is introduced that simultaneously incorporates multiple levels of granularity resulting in even more accurate predictions. Further, the effect of the sample size is examined. This showed that including spatial interdependence using finer levels of granularity is only useful when enough data is available to construct reliable spatial lag effects. As a result, extending a spatial model with multiple granularity levels becomes increasingly valuable when the data sample becomes larger. |
| Keywords: | Customer Relationship Management (CRM); Predictive Analytics; Customer Intelligence; Marketing; Data Augmentation; Autoregressive Model; Automobile Industry |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:12/819&r=geo |
| By: | Konstantin Gluschenko |
| Abstract: | A popular methodology of studying spatial income inequality is analysis of beta-convergence (i.e. an inverse relationship between current income per capita and its initial level). Its widespread use is based on a belief that the economic growth theory predicts income convergence among economies (countries or regions within a country), and that beta-convergence suggests decreasing income inequality. This article demonstrates that these are nothing but myths; hence, analyzing of betaconvergence cannot serve as an adequate methodology for studying and predicting the evolution of spatial income inequality. |
| Keywords: | spatial income inequality, convergence, economic growth |
| JEL: | D63 O11 O40 |
| Date: | 2012–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2012-1040&r=geo |
| By: | Ariga, Kenn (Kyoto University); Ohtake, Fumio (Osaka University); Sasaki, Masaru (Osaka University); Wu, Zheren (Kinki University) |
| Abstract: | This paper uses a unique survey of the Chinese youth to construct a panel data in which we keep track of geographical and job mobilities. Our estimation results deliver the following major findings. (1) The sample individuals are highly mobile. Job quits and relocations are frequent and they are closely correlated. We find that job hopping to be highly productive as our estimates indicate each job quit generates more than .2 log increase in monthly wage. (2) The migrant disadvantage in urban labor market is compensated by their higher job mobility. After four jobs, the expected earnings differentials essentially disappear. We also find that migration and job mobility are highly selective processes. Our evidence indicates that the migrants are positively selected. (3) Job and location mobilities are highly dependent upon family back ground and personal traits which we interpret as representing unobservable characteristics associated with risk taking, active and optimistic personality, as well as the implied economic incentives to migrate and keep searching for better jobs. |
| Keywords: | wage growth, migration, school to work transition |
| JEL: | J31 J61 J62 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7104&r=geo |
| By: | Quamrul Ashraf; Oded Galor |
| Abstract: | Despite the importance attributed to the effects of diversity on the stability and prosperity of nations, the origins of the uneven distribution of ethnic and cultural fragmentation across countries have been underexplored. Building on the role of deeply-rooted biogeographical forces in comparative development, this research empirically demonstrates that genetic diversity, predominantly determined during the prehistoric "out of Africa" migration of humans, is an underlying cause of various existing manifestations of ethnolinguistic heterogeneity. Further exploration of this uncharted territory may revolutionize the understanding of the effects of deeply-rooted factors on economic development and the composition of human capital across the globe. |
| JEL: | N30 O10 O50 Z10 |
| Date: | 2013–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18738&r=geo |
| By: | Cali, Massimiliano; Menon, Carlo |
| Abstract: | Although a high rate of urbanization and a high incidence of rural poverty are two distinct features of many developing countries, there is little knowledge of the effects of the former on the latter. Using a large sample of Indian districts from the 1983-1999 period, the authors find that urbanization has a substantial and systematic poverty-reducing effect in the surrounding rural areas. The results obtained through an instrumental variable estimation suggest that this effect is causal in nature and is largely attributable to the positive spillovers of urbanization on the rural economy rather than to the movement of the rural poor to urban areas. This rural poverty-reducing effect of urbanization is primarily explained by increased demand for local agricultural products and, to a lesser extent, by urban-rural remittances, the rural land/population ratio, and rural nonfarm employment. |
| Keywords: | Rural Poverty Reduction,Population Policies,Regional Economic Development,Achieving Shared Growth |
| Date: | 2013–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6338&r=geo |
| By: | Le Goff, Maelan; Singh, Raju Jan |
| Abstract: | Although trade liberalization is being actively promoted as a key component in development strategies, theoretically, the impact of trade openness on poverty reduction is ambiguous. A more liberalized trade regime is argued to change relative factor prices in favor of the more abundant factor. If poverty and relative low income stem from abundance of labor, greater trade openness should lead to higher labor prices and a decrease in poverty. However, should the re-allocation of factors be hampered, the expected benefits from freer trade may not materialize. The theoretical ambiguity on the effects of openness is reflected in the available empirical evidence. This paper examines how the effect of trade openness on poverty may depend on complementary reforms that help a country take advantage of international competition. Using a non-linear regression specification that interacts a proxy of trade openness with proxies of various country structural specificities and a panel of 30 African countries over the period 1981-2010, the analysis finds that trade openness tends to reduce poverty in countries where financial sectors are deep, education levels high and governance strong. |
| Keywords: | Achieving Shared Growth,Free Trade,Economic Theory&Research,Trade Policy,Emerging Markets |
| Date: | 2013–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6327&r=geo |
| By: | Ignacio A. Inoa (THEMA - Théorie économique, modélisation et applications - CNRS : UMR8184 - Université de Cergy Pontoise); Nathalie Picard (THEMA - Théorie économique, modélisation et applications - CNRS : UMR8184 - Université de Cergy Pontoise); André De Palma (ENS Cachan - Ecole Normale Supérieure de Cachan - École normale supérieure de Cachan - ENS Cachan) |
| Abstract: | The effect of an individual-specific measure of accessibility to jobs is analyzed using a three-level nested logit model of residential location, workplace, and job type choice. This measure takes into account the attractiveness of different job types when the workplace choice is anticipated in the residential location decision. The model allows for variation in the preferences for job types across individuals and accounts for individual heterogeneity of preferences at each choice level in the following dimensions: education, age, gender and children. Using data from the Greater Paris Area, estimation results indicate that the individual-specific accessibility measure is an important determinant of the residential location choice and its effect differ along the life cycle. Results also show that the job type attractiveness measure is a more significant predictor of workplace location than the standard measures. |
| Keywords: | residential location; job location; accessibility; nested logit; Greater Paris |
| Date: | 2013–01–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-00776945&r=geo |
| By: | Dube, Arindrajit (University of Massachusetts Amherst); Dube, Oeindrila (New York University); García-Ponce, Omar (New York University) |
| Abstract: | To what extent, and under what conditions, does access to arms fuel violent crime? To answer this question, we exploit a unique natural experiment: the 2004 expiration of the U.S. Federal Assault Weapons Ban exerted a spillover on gun supply in Mexican municipios near Texas, Arizona and New Mexico, but not near California, which retained a pre-existing state-level ban. We find first that Mexican municipios located closer to the non-California border states experienced differential increases in homicides, gun-related homicides and crime gun seizures in the post-2004 period. Second, the magnitude of this effect is contingent on political factors related to Mexico's democratic transition. Killings increased substantially more in municipios where local elections had become more competitive prior to 2004, with the largest differentials emerging in high narco-trafficking areas. Our findings are consistent with the notion that political competition undermined informal agreements between drug cartels and entrenched local governments, highlighting the role of political instability in mediating the gun-crime relationship. |
| Keywords: | gun control, violence, informal employment, cross-border spillover, cartels |
| JEL: | K14 D72 D73 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7098&r=geo |
| By: | Eberhardt, Markus; Teal, Francis |
| Abstract: | One of the most striking features of economic growth is the process of structural change whereby the share of agriculture in GDP decreases as countries develop. The cross-country growth literature typically estimates an aggregate homogeneous production function or convergence regression model that abstracts from this process of structural change. This paper investigates the extent to which assumptions about aggregation and homogeneity matter for inferences regarding the nature of technology differences across countries. Using a unique World Bank dataset, it estimates production functions for agriculture and manufacturing in a panel of 40 developing and developed countries for the period from 1963 to 1992. It empirically models dimensions of heterogeneity across countries, allowing for different choices of technology within both sectors. The paper argues that heterogeneity is important within sectors across countries implying that an analysis of aggregate data will not produce useful measures of the nature of the technology or productivity. It shows that many of the puzzling elements in aggregate cross-country empirics can be explained by inappropriate aggregation across heterogeneous sectors. |
| Keywords: | Economic Theory&Research,E-Business,ICT Policy and Strategies,Economic Growth,Statistical&Mathematical Sciences |
| Date: | 2013–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6335&r=geo |
| By: | Bertoli, Simone (CERDI, University of Auvergne); Fernández-Huertas Moraga, Jesús (FEDEA, Madrid) |
| Abstract: | The scale of international migration flows depends on moving costs that are, in turn, influenced by host-country policies and by the size of migrant networks at destination. This paper estimates the influence of visa policies and networks upon bilateral migration flows to multiple destinations. We rely on a Poisson pseudo-maximum likelihood estimator to derive estimates that are consistent under more general distributional assumptions on the underlying RUM model than the ones commonly adopted in the literature. We derive bounds for the estimated direct and indirect effects of visa policies and networks that reflect the uncertainty connected to the use of aggregate data, and we show that bilateral migration flows can be highly sensitive to the immigration policies set by other destination countries, an externality that we are able to quantify. |
| Keywords: | international migration, networks, visa policies, multiple destinations, externalities |
| JEL: | F22 O15 J61 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7094&r=geo |