nep-geo New Economics Papers
on Economic Geography
Issue of 2013‒08‒10
fourteen papers chosen by
Andreas Koch
Institute for Applied Economic Research

  1. Regional resilience By Jeffrey Lin
  2. Regional Policy Evaluation: Interactive Fixed Effects and Synthetic Controls By Laurent Gobillon; Thierry Magnac
  3. Proximity to Hubs of Expertise in Financial Analyst Forecast Accuracy By Elisa Cavezzali; Jacopo Crepaldi; Ugo Rigoni
  4. Networks of innovators within and across borders. Evidence from patent data By Andrea Morescalchi; Fabio Pammolli; Orion Penner; Petersen Alexander M.
  5. The Costs of Agglomeration: Land Prices in French Cities By Pierre-Philippe Combes; Gilles Duranton; Laurent Gobillon
  6. Causality in the Link Between Road Network Growth and Regional Development By Michael Iacono; David Levinson
  7. Does land fragmentation affect farm performance? A case study from Brittany By Latruffe, Laure; Piet, Laurent
  8. The Spatial Business Landscape of India By Vaz, Eric
  9. A Multi-Dasymetric Mapping Approach for Tourism By Vaz, Eric; Campos, Ana Claudia
  10. Looking for PeripheRurality By Beatrice Camaioni; Roberto Esposti; Antonello Lobianco; Francesco Pagliacci; Franco Sotte
  11. A Regional Spatial-retrofitting Approach (RSRA) to Geovisualise Regional Urban Growth: An Application to the Golden Horseshoe in Canada By Vaz, Eric; Buckland, Amy; Worthington, Kevin
  12. A Graph Theory Approach for Geovisualization of Anthropogenic Land Use Change: An Application to Lisbon By Vaz, Eric; Aversa, Joseph
  13. Regional Disparities in Per Capita Income in India: Convergence or Divergence? By A.P.Thirlwall
  14. Spatial, temporal and size distribution of freight train delays: evidence from Sweden By Krüger, Niclas A.; Vierth , Inge; Fakhraei Roudsari, Farzad

  1. By: Jeffrey Lin (Federal Reserve Bank of Philadelphia)
    Abstract: In this paper, I study long-run population changes across U.S. metropolitan areas. First, I argue that changes over a long period of time in the geographic distribution of population can be informative about the so-called \resilience" of regions. Using the censuses of population from 1790 to 2010, I find that persistent declines, lasting two decades or more, are somewhat rare among metropolitan areas in U.S. history, though more common recently. Incorporating data on historical factors, I find that metropolitan areas that have experienced extended periods of weak population growth tend to be smaller in population, less industrially diverse, and less educated. These historical correlations inform the construction of a regional resilience index.
    Keywords: City growth, metropolitan areas, persistence
    JEL: N91 N92 R11 R12 R23
    Date: 2013
  2. By: Laurent Gobillon (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - École des Hautes Études en Sciences Sociales [EHESS] - Ecole des Ponts ParisTech - Ecole normale supérieure de Paris - ENS Paris - Institut national de la recherche agronomique (INRA), EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, INED - Institut National d'Etudes Démographiques Paris - INED); Thierry Magnac (TSE - Toulouse School of Economics - Toulouse School of Economics)
    Abstract: In this paper, we investigate the use of interactive e¤ect or linear factor models in regional policy evaluation. We contrast treatment effect estimates obtained by Bai (2009)'s least squares method with the popular difference in difference estimates as well as with estimates obtained using synthetic control approaches as developed by Abadie and coauthors. We show that difference in differences are generically biased and we derive the support conditions that are required for the application of synthetic controls. We construct an extensive set of Monte Carlo experiments to compare the performance of these estimation methods in small samples. As an empirical illustration, we also apply them to the evaluation of the impact on local unemployment of an enterprise zone policy implemented in France in the 1990s.
    Keywords: Policy evaluation ; Linear factor models ; Synthetic controls ; Economic geography ; Enterprise zones
    Date: 2013–07
  3. By: Elisa Cavezzali (Università Ca' Foscari Venice); Jacopo Crepaldi; Ugo Rigoni (Università Ca' Foscari Venice)
    Abstract: This paper investigates whether the geographical proximity of financial analysts to hubs of information and expertise can influence their forecasting accuracy. Recent studies show that the financial analyst forecasting process show a systematic difference in earnings forecast accuracy dependent on the geographical distance of analysts from the companies which they follow. The literature argues that local analysts issue more accurate forecasts because they have an informational advantage over analysts who are further away. Industrial centres can constitute important knowledge spillovers by creating formal and informal networks amongst firms and higher education and research institutions. In such a hub, information can easily flow and propagate. Our hypothesis is that physical proximity to these hubs, and not to the companies they follow, is an advantage for financial analysts, leading to the issue of more accurate forecasts. Using a sample of 205 observations related to 33 firms, across seven countries and ten sectors, our results are consistent with the hypothesis. Even though preliminary, and probably in part biased by sample selection issues, overall, the empirical evidence confirms the benefit of being part of a network, formal or informal, in which information, knowledge and expertise sharing can flow easily. We try to give some new evidence on what can cause variations in financial analyst accuracy by exploring these concepts, well known and analysed in other fields, but new in the context of financial analysts.
    Keywords: forecast accuracy, sell-side analysts, geography, hubs of knowledge
    JEL: M40 M41
    Date: 2013–08
  4. By: Andrea Morescalchi (IMT Lucca Institute for Advanced Studies); Fabio Pammolli (IMT Lucca Institute for Advanced Studies); Orion Penner (IMT Lucca Institute for Advanced Studies); Petersen Alexander M. (IMT Lucca Institute for Advanced Studies; IMT Lucca Institute for Advanced Studies and Department of Managerial Economics, Strategy and Innovation, K.U. Leuven)
    Abstract: Recent studies on the geography of knowledge networks have documented a negative impact of physical distance and institutional borders upon research and development (R&D) collaborations. Though it is widely recognized that geographic constraints hamper the diffusion of knowledge, less attention has been devoted to the temporal evolution of these constraints. In this study we use data on patents filed with the European Patent Office (EPO) for 50 countries to analyze the impact of physical distance and country borders on inter-regional links in four different networks over the period 1988-2009: (1) co-inventorship, (2) patent citations, (3) inventor mobility and (4) the location of R&D laboratories. We find the constraint imposed by country borders and distance decreased until mid-1990s then started to grow, particularly for distance. The intensity of European cross-country inventor collaborations increased at a higher pace than their non-European counterparts until 2004, with no significant relative progress afterwards. Moreover, when analyzing networks of geographical mobility, multinational R&D activities and patent citations we do not depict any substantial progress in European research integration aside from the influence of common global trends.
    Keywords: Geography of knowledge; Networks of Innovators; European integration; Spatial proximity; Crossborder collaboration; Gravity model
    JEL: O30 R10 R23
    Date: 2013–08
  5. By: Pierre-Philippe Combes (Université d'Aix-Marseille - PRES Aix Marseille Université, CEPR - Center for Economic Policy Research - CEPR); Gilles Duranton (Wharton School, University of Pennsylvania - University of Pennsylvania); Laurent Gobillon (CEPR - Center for Economic Policy Research - CEPR, PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - École des Hautes Études en Sciences Sociales [EHESS] - Ecole des Ponts ParisTech - Ecole normale supérieure de Paris - ENS Paris - Institut national de la recherche agronomique (INRA), EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, INED - Institut National d'Etudes Démographiques Paris - INED, IZA - Institute for the Study of Labor - IZA)
    Abstract: We develop a new methodology to estimate the elasticity of urban costs with respect to city population using French land price data. Our preferred estimate, which handles a number of estimation concerns, stands at 0.041. Our approach also yields a number of intermediate outputs of independent interest such as a distance gradient for land prices and the elasticity of unit land prices with respect to city population. For the latter, our preferred estimate is 0.72.
    Keywords: Urban costs ; Land prices ; Land use ; Agglomeration
    Date: 2013–07–30
  6. By: Michael Iacono; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)
    Abstract: This paper investigates the relationship between the growth of road networks and regional development. We test for mutual causality between the growth of road networks (which are divided functionally into local roads and highways) and changes in county-level population and employment. We employ a panel data set containing observations of road mileage by type for all Minnesota counties over the period 1988 to 2007 to fit a model describing changes in road networks, population and employment. Results indicate that causality runs in both directions between population and local road networks, while no evidence of causality in either direction is found for networks and local employment. We interpret the findings as evidence of a weakening influence of road networks (and transportation more generally) on location, and suggest methods for refining the empirical approach described herein.
    Keywords: network expansion, economic evaluation, regional growth, rural development, economic development
    JEL: O18 R42 R48
    Date: 2013
  7. By: Latruffe, Laure; Piet, Laurent
    Abstract: Agricultural land fragmentation is widespread and may affect farmers’ decisions and impact farm performance, either negatively or positively. We investigated this impact for the western region of Brittany, France, in 2007. To do so, we regressed a set of performance indicators on a set of fragmentation descriptors. The performance indicators (production costs, yields, revenue, profitability, technical and scale efficiency) were calculated at the farm level using Farm Accountancy Data Network (FADN) data, while the fragmentation descriptors were calculated at the municipality level using data from the cartographic field pattern registry (RPG). The various fragmentation descriptors enabled us to account for not only the traditional number and average size of plots, but also their geographical scattering. We found that farms experienced higher costs of production, lower crop yields and lower profitability where land fragmentation (LF) was more pronounced. Total technical efficiency was not found to be significantly related to any of the municipality LF descriptors used, while scale efficiency was lower where the average distance to the nearest neighbouring plot was greater. Pure technical efficiency was found to be negatively related to the average number of plots in the municipality, with the unexpected result that it was also positively related to the average distance to the nearest neighbouring plot. By simulating the impact of hypothetical consolidation programmes on average pre-tax profits and wheat yield, we also showed that the marginal benefits of reducing fragmentation may differ with respect to the improved LF dimension and the performance indicator considered. Our analysis therefore shows that the measures of land fragmentation usually used in the literature do not reveal the full set of significant relationships with farm performance and that, in particular, measures accounting for distance should be considered more systematically.
    Date: 2013–04
  8. By: Vaz, Eric (Ryerson University)
    Abstract: India has in the last decade become of the fastest growing entrepreneurial landscapes in the world. With a total population of almost 1.2 billion inhabitants, it has developed from a rural economy into a highly competitive market. This study analyses the spatial configuration across the country from a regional perspective, offering an assessment of the spatial autocorrelation of business as to understand the spatial configuration of what I define as a regional-spatial business landscape. In this study, the patterns of distribution of all the registered Indian businesses are assessed counting a total of 6500 registered businesses from 1850 to 2010, which were geocoded and imported into a Geographic Information System environment. A geostatistical analysis is conducted measuring business growth and performance at a national level by means of a Global Moran’s I calculation and followed by assembling a Local Getis-Ord for regional assessment of correlation of road networks. These local spatial statistics reveal clustering of hot spots within threshold distances of road concentrations, suggesting a positive relation between location of businesses and concentration of road networks. The agglomeration of Indian businesses becomes defined by the importance of road infrastructures to allow commutes and interaction of businesses. As a result, it becomes possible to see that India’s business landscape is far from homogenous, and responds well to Weber’s theory of industrial agglomeration, while predicting possible interfirm collaboration. These business hubs in the business landscape are assessed at national level through spatial autocorrelation and then regionally diagnosed by identifying hot spots of business location given business density, and bringing to light the precise location of India’s business hubs from a spatial business landscape perspective at present.
    Keywords: Business Landscape; GIS; Spatial Analysis; Geostatistics
    JEL: Q01 R52
    Date: 2013–08–02
  9. By: Vaz, Eric (Ryerson University); Campos, Ana Claudia (University of Algarve)
    Abstract: The challenge of measuring at municipal level tourism density has been a daunting task for both statisticians and geographers. The reason of this is enforced by the fact that administrative areas, such as municipalities, tend to be large spatial administrative units, sharing a large demographic asymmetry of tourist demand within the municipality. The rationale is that geographic characteristics such as coastal line, climate and vegetation, play a crucial role in tourist offer, leaning towards the conclusion that traditional census at administrative Level are simply not enough to interpret the true distribution of tourism data. A more quantifiable method is necessary to assess the distribution of socio-economic data. This is developed by means of a dasymetric approach adding on the advantages of multi-temporal comparison. This paper adopts a dasymetric approach for defining tourism density per land use types using the CORINE Land Cover dataset. A density map for tourism is calculated, creating a modified areal weighting (MAW) approach to assess the distribution of tourism density per administrative municipality. This distribution is then assessed as a bidirectional layer on the land use datasets for two temporal stamps: 2000 and 2006, which leads to (i) a consistent map on a more accurate distribution of tourism in Algarve, (ii) the calculation of tourism density surfaces, and (iii) a multi-locational and temporal assessment through density crosstabulation. Finally a geovisual interpretation of locational analysis of tourism change in Algarve for the last decade is created. This integrative spatial methodology offers unique characteristics for more accurate decision making at regional level, bringing an integrative methodology to the forefront of linking tourism with the spatio-temporal clusters formed in rapidly changing economic regions.
    Keywords: Dasymetric Mapping; Tourism Density; Land Use Dynamics; Tourism Analysis
    JEL: L83 O44 R12 R15 R52
    Date: 2013–08–02
  10. By: Beatrice Camaioni; Roberto Esposti; Antonello Lobianco; Francesco Pagliacci; Franco Sotte
    Abstract: Rural areas still play a major role within the EU, as Europe is still a fairly rural continent. Moreover, EU rural areas are going through greater challenges and major transformations. After the Eastern enlargements of the EU (in 2004 and 2007), they are getting more and more heterogeneous, in terms of their main socio-economic features as well as of agricultural activities. According to this increasing heterogeneity, the traditional urban-rural divide can be now considered almost outdated (OECD, 2006). Indeed, a multidimensional approach is crucial in order to catch all the different features affecting trends and development of rural areas. For example, central rural regions in Continental countries sharply differ from more peripheral rural areas still facing major development issues. This research has highlighted the main dimensions affecting EU rural areas. First, some considerations on the main drivers of EU territorial development have been analysed. Then, throughout cluster analysis, specific typologies of EU rural areas have been identified. According to this classification, clear territorial patterns emerge. Actually, clusters of more central and more accessible regions are quite different from those clusters composed by more peripheral and lagging behind regions. Thus, geography still affects deeply both the economic performance of regions and their main socio-demographic trends (both in urban and rural areas). Moreover, by computing a comprehensive PeripheRurality (PR) Index, the existence of a more complex geography at the EU scale emerges. National approaches to rural and peripheral areas should be substituted by broader approaches, encompassing all the different territorial level of the analysis.
    Keywords: Economic growth path, EU integration, rural development, regional policy
    JEL: O18 R11 R58 Q01
    Date: 2013–07
  11. By: Vaz, Eric (Ryerson University); Buckland, Amy (Ryerson University); Worthington, Kevin (Ryerson University)
    Abstract: Understanding urban change in particular for larger regions has been a great demur in both regional planning and geography. One of the main challenges has been linked to the potential of modelling urban change. The absence of spatial data and size of areas of study limit the traditional urban monitoring approaches, which also do not take into account visualization techniques that share information with the community. This is the case of the Golden Horseshoe in southern Ontario in Canada, one of the fastest growing regions in North America. An unprecedented change on the urban environment has been witnessed, leading to an increased importance of awareness for future planning in the region. With a population greater than 8 million, the Golden Horseshoe is steadily showing symptoms of becoming a mega-urban region, joining surrounding cities into a single and diversified urban landscape. However, little effort has been done to understand these changes, nor to share information with policy makers, stakeholders and investors. These players are in need of the most diverse information on urban land use, which is seldom available from a single source. The spatio-temporal effect of the growth of this urban region could very well be the birth of yet another North American megacity. Therefore, from a spatial perspective there is demand for joint collaboration and adoption of a regional science perspective including land cover and spatio-temporal configurations. This calls forth a novel technique that allows for assessment of urban and regional change, and supports decision-making without having the usual concerns of locational data availability. It is this sense, that we present a spatial-retrofitting model, with the objective of (i) retrofitting spatial land use based on current land use and land cover, and assessing proportional change in the past, leading to four spatial timestamps of the Golden Horseshoe’s land use, while (ii) integrating this in a multi-user open source web environment to facilitate synergies for decision-making. This combined approach is referred to as a regional-spatial-retrofitting approach (RSRA), where the conclusions permit accurate assessment of land use in past time frames based on Landsat imagery. The RSRA also allows for a collective vision of regional urban growth supporting local governance through a decision-making process adhering to Volunteered Geographic Information Systems. Urban land use change can be refined by means of contribution from end-users through a web environment, leading to a constant understanding and monitoring of urban land use and urban land use change.
    Keywords: Golden Horseshoe; Land Use Change; Regional Management; Urban Growth
    JEL: O44 R11 R52
    Date: 2013–08–02
  12. By: Vaz, Eric (Ryerson University); Aversa, Joseph (Ryerson University)
    Abstract: Urban sprawl and growth has experienced increased concern in geographic and environmental literature. Preceding the existence of robust frameworks found in regional and urban planning, as well as urban geography and economics, the spatial properties of allocation of urban land use are still far from being completely understood. This is largely due to the underlying complexity of the change found at the spatial level of urban land use, merging social, economic and natural drivers. The spatial patterns formed, and the Connectivity established among the different subsets of land-use types, becomes a complex network of interactions over time, helping to shape the structure of the city. The possibility to merge the configuration of land-use with complex networks may be assessed elegantly through graph theory. Nodes and edges can become abstract representations of typologies of Space and are represented into a topological space of different land use types which traditionally share common spatial boundaries. Within a regional framework, the links between adjacent and neighboring urban land use types become better understood, by means of a Kamada-Kawai algorithm. This study uses land use in Lisbon over three years, 1990, 2000 and 2006, to develop a Kamada-Kawai graph interpretation of land-use as a result of neighboring power. The rapid change witnessed in Lisbon since the nineties, as well as the availability of CORINE Land Cover data in these three time stamps, permits a reflection on anthropogenic land-use change in urban and semi-urban areas in Portugal’s capital. This paper responds to (1) the structure and connectivity of urban land use over time, demonstrating that most of the agricultural land is stressed to transform to urban, gaining a central role in future. (2) Offer a systemic approach to land-use transitions generating what we call spatial memory, where land use change is often unpredictable over space, but becomes evident in a graph theory framework, and (3) advance in the geovisual understanding of spatial phenomena in land use transitions by means of graph theory. Thus, the structure of this combined Method enables urban and landscape to have a better understanding of the spatial interaction of land-use types within the city, promoting an elegant solution to rapid geovisualization for land-use management in general.
    Keywords: Graph Theory; Spatial Interaction; Urban Change; Land Use Change
    JEL: R11 R14 R52 R58
    Date: 2013–08–02
  13. By: A.P.Thirlwall
    Abstract: The paper looks at the latest evidence of what has been happening to regional disparities in per capita income (measured as Gross State Domestic Product per capita) in India over the first decade of the twenty first century (1999/00 to 2010/11) by estimating cross section equations for unconditional and conditional beta convergence and sigma convergence across thirty two regions (twenty-eight States and four Union Territories). There is no evidence of unconditional convergence, but weak evidence of conditional convergence controlling for population growth; credit growth; male literacy; the share of agriculture in State GDP, and State expenditure as a share of State GDP. Sigma divergence has increased continuously, except among the poorest States.
    Keywords: Regional Growth; India; Convergence/Divergence
    JEL: O47 O53 R11
    Date: 2013–08
  14. By: Krüger, Niclas A. (VTI); Vierth , Inge (VTI); Fakhraei Roudsari, Farzad (TRENoP)
    Abstract: This paper analyzes how freight train delays are distributed with respect to size, location and time of their occurrence. Arrival delays are analyzed in detail using data covering all freight train departures and arrivals during 2008 and 2009 in Sweden. Moreover, the link between capacity usage and expected delay is analyzed using the fact that demand fluctuates on different time scales, especially due to the economic chock in 2009. Since the distribution of delays on different scales describe reliability and vulnerability in the rail transport system, the results have potentially important policy implications for rail investment appraisal.
    Keywords: Fat-tails; Freight; Delays; Rail; Reliability; Vulnerability
    JEL: R41
    Date: 2013–08–05

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