nep-geo New Economics Papers
on Economic Geography
Issue of 2013‒07‒20
six papers chosen by
Andreas Koch
Institute for Applied Economic Research

  1. Regional characteristics, opportunity perception and entrepreneurial activities By Stuetzer, Michael; Obschonka, Martin; Brixy, Udo; Sternberg, Rolf; Cantner, Uwe
  2. The Spatial Diffusion of Technology By Diego Comin; Mikhail Dmitriev; Esteban Rossi-Hansberg
  3. Spatial Analysis of Income Growth in the Philippines: Evidence from Intra-Country Data (1988 to 2009) By Mapa, Dennis; Albis, Manuel Leonard; Comandante, Dorcas Mae; Cura, Josephine; Ladao, Ma. Maureen
  4. Spacey Parents and Spacey Hosts in FDI By Badinger Harald; Peter Egger
  5. Proximity as a Source of Comparative Advantage By Elizaveta Archanskaia
  6. European Integration and Knowledge Flows across European Regions By Cappelli, Riccardo; Montobbio, Fabio

  1. By: Stuetzer, Michael; Obschonka, Martin; Brixy, Udo; Sternberg, Rolf; Cantner, Uwe
    Abstract: This paper seeks to better understand the link between regional characteristics and individual entrepreneurship. We combine individual-level GEM data for Western Germany with regional-level data, using multi-level analysis to test our hypotheses. We find no direct link between regional knowledge creation, the economic context and an entrepreneurial culture on the one side and individual business start-up intentions and start-up activity on the other side. However our findings point to the importance of an indirect effect of regional characteristics as knowledge creation, the economic context and an entrepreneurial culture have an effect on the individual perception of founding opportunities which in turn predicted start-up intentions and activity.
    Keywords: Regional entrepreneurship; nascent entrepreneurship; opportunity perception; creative class; Global Entrepreneurship Monitor (GEM)
    JEL: J24 L26 M13
    Date: 2013
  2. By: Diego Comin; Mikhail Dmitriev; Esteban Rossi-Hansberg
    Abstract: We study technology diffusion across countries and over time empirically. We …find signi…cant evidence that technology diffuses slower to locations that are farther away from adoption leaders. This effect is stronger across rich countries and also when measuring distance along the south- north dimension. A simple theory of human interactions can account for these empirical …ndings. The theory suggests that the e¤ect of distance should vanish over time, a hypothesis that we con…rm in the data, and that distinguishes technology from other ‡ows like goods or investments. We then structurally estimate the model. The parameter governing the frequency of interactions is larger for newer and network-based technologies and for the median technology the frequency of interactions decays by 73% every 1000 Kms. Overall, we document the signi…cant role that geography plays in determining technology diffusion across countries.
    Date: 2013–03–27
  3. By: Mapa, Dennis; Albis, Manuel Leonard; Comandante, Dorcas Mae; Cura, Josephine; Ladao, Ma. Maureen
    Abstract: This paper looks at the spatial relationship of the average per capita income growth using intra-country or provincial data from 1988 to 2009. The results from the study provide insights on the geographical dimensions of provincial income growth and showed evidence on the role of spatial effects in the formal econometric analysis of intra-country income growth models. Despite the data limitations, the study provides a strong empirical evidence of the presence of positive spatial dependence or degree of similarity in the average per capita income growth of the provinces, albeit the degree of positive spatial dependence weakens in the latter periods. This positive spatial correlation suggests the provinces may be converging in terms of their income growth and they do so in movements similar to their neighbors. Moreover, the study shows that spatial dependence weakened in the latter periods (1994-2000 and 2000-2009). The weakening of spatial dependence may provide insights on the uneven provincial/regional income growth experienced in the country. One possible explanation of the weak spatial dependence is that two or more groups of neighboring provinces are growing at similar rates within the group, but at different rates across groups. This opens the possibility of having different convergence clubs (of provinces) within the country.
    Keywords: Spatial Dependence, Moran’s Index, Intra-Country Growth Model
    JEL: O1 O4
    Date: 2013–06
  4. By: Badinger Harald (Department of Economics, Vienna University of Economics and Business); Peter Egger (ETH Zürich)
    Abstract: Empirical trade economists have found that shocks on foreign direct investment (FDI) of some parent country in a host country affect the same parent country’s FDI in other hosts (interdependent hosts). Independent of this, there is evidence that shocks on a parent country’s FDI in some host economy affect other parent countries’ FDI in the same host (interdependent parents). In general equilibrium, shocks on FDI between any country pair will affect all country-pairs’ FDI in the world, including anyone of the two countries in a pair as well as third countries (interdependent third countries). No attempt has been made so far to allow simultaneously for all three modes of interdependence of FDI. Using cross-sectional data on FDI among 22 OECD countries in 2000, we employ a spatial feasible generalized two-stage least squares and generalized moments estimation framework to allow for all three modes of interdependence across all parent and host countries, thereby distinguishing between market-size-related and remainder interdependence. Our results highlight the complexity of multinational enterprises’ investment strategies and the interconnectedness of the world investment system.
    Keywords: Foreign direct investment, Spatial econometrics, Generalized method of moments estimation
    JEL: C21 F21 F23
    Date: 2013–07
  5. By: Elizaveta Archanskaia
    Abstract: This paper establishes that production unbundling has coincided with an inscreasing role of input costs in shaping the pattern of comparative advantage. I show that the wedge in the cost of the input bundle across countries in a multisectoral Ricardian model is given by a composite index of trade frictions incurred in sourcing inputs. As the cost share of inputs is sector-specific this wedge becomes source of comparative advantage whereby countries characterized by relatively high proximity to input suppliers specialize in sectors which use inputs more intensively. I find robust empirical evidence that the input cost channel has growing importance over 1995-2009. Nonetheless, consistently with the fundamental intuition of Ricardian models, the ranking of relative sectoral technology stocks still determines intersectoral specialization. Between 53-55% of intersectoral variation in relative sectoral exports is explained by technology while the input cost channel contributes 3 to 8% in the full sample, and 3 to 13% for the EU-15.
    Keywords: Ricardian model, Intersectoral specialization, Trade costs
    JEL: F10 F15
    Date: 2013–02
  6. By: Cappelli, Riccardo; Montobbio, Fabio (University of Turin)
    Abstract: Using data on inventor citations and inventor collaborations, this article analyses changes in geographical patterns of knowledge flows between European regions during the period 1981-2000. It shows that inventor collaborations become less geographically localized, while inventor citations become more localized. The European integration process has a significant effect on reducing barriers to knowledge flows between new and old EU members. For inventor citations, this effect relates only to the EU enlargement of 1995 and is confined to knowledge flows from Austria, Finland and Sweden to old EU members.
    Date: 2013–05

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