nep-geo New Economics Papers
on Economic Geography
Issue of 2014‒06‒14
sixteen papers chosen by
Andreas Koch
Institute for Applied Economic Research

  1. New economic geography and the city By Carl Gaigné; Jacques-François Thisse
  2. Knowledge, innovation and space By Karlsson, Charlie; Johansson, Börje; Kobayashi, Kiyoshi; Stough, Roger R.
  3. What Makes Cities More Productive? Evidence on the Role of Urban Governance from Five OECD Countries By Rudiger Ahrend; Emily Farchy; Ioannis Kaplanis; Alexander C. Lembcke
  4. Urbanization and spatial patterns of internal migration in India By S. Chandrasekhar; Ajay Sharma
  5. Assessing Polycentric Urban Systems in the OECD: Country, Regional and Metropolitan Perspectives By Monica Brezzi; Paolo Veneri
  6. Infrastructure and the international export performance of Turkish regions By Celbis M.G.; Nijkamp P.; Poot J.
  7. The Role of Government Institutions for Smart Specialisation and Regional Development By Andres RODRIGUEZ-POSE; Marco DI CATALDO; Alessandro RAINOLDI
  8. Regional development policy in context of Europe 2020 Strategy By Antonescu, Daniela
  9. Do U.S. State Firearms Laws Affect Firearms Manufacturing Location? By Jurgen Brauer; Daniel Montolio; Elisa Trujillo
  10. Natural Disasters, Land Price, and Location of Firms: Evidence from Thailand By NAKATA Hiroyuki; SAWADA Yasuyuki; SEKIGUCHI Kunio
  11. Ecological Barriers and Convergence: a Note on Geometry in Spatial Growth Models By Giorgio FABBRI
  12. Relatedness in eco-technological development in European regions By Martijn van den Berge; Anet Weterings
  13. Universities and Smart Specialisation By Louise KEMPTON; John Goddard; John Edwards; Fatime B. Hegyi; Susana Elena-Pérez
  14. Decentralization in Colombia: Searching for Social Equity in a Bumpy Economic Geography By Juan Mauricio Ramírez; Yadira Díaz; Juan Guillermo Bedoya
  15. Structural change in the Ruhr region: problems, potentials and developments By Adrian Götting
  16. How diverse can spatial measures of cultural diversity be? Results from Monte Carlo simulations of an agent-based model By Daniel Arribas-Bel; Peter Nijkamp; Jacques Poot

  1. By: Carl Gaigné (Structures et Marchés Agricoles, Ressources et Territoires, INRA); Jacques-François Thisse (Center for Operations Research and Econometrics)
    Abstract: New economic geography (NEG) has proven to be very useful in dealing with a large number of issues. Yet, in this paper we do not discuss the canonical NEG models and their vast number of extensions. Rather, we provide an overview of recent developments in the NEG literature that build on the idea that the difference in the economic performance of regions is explained by the behavior and interactions between households and firms located within them. This means that we consider NEG models which take into account land markets, thereby the internal structure and industrial mix of urban agglomerations.
    Abstract: La Nouvelle Economie Géographique (NEG) s'est avéré être très adapté pour traiter un grand nombre de questions. Dans cet article, nous ne discutons pas des modèles canoniques de la NEG et de leurs nombreuses extensions. Nous présentons un aperçu des récents développements de cette littérature qui s'appuient sur l'idée que la différence dans la performance économique des régions s'explique par le comportement et les interactions entre les ménages et les entreprises. Cela signifie que nous considérons des modèles NEG qui prennent en compte les marchés fonciers, ainsi que la structure interne et la composition industrielle des agglomérations urbaines.
    Keywords: villelocalisation des entreprises
    Date: 2013
  2. By: Karlsson, Charlie (CESIS, Jönköping International Business School); Johansson, Börje (CESIS, Jönköping International Business School); Kobayashi, Kiyoshi (Kyoto University); Stough, Roger R. (George Mason University)
    Abstract: This paper provides an overview of relevant topics in contemporary research concerned with global, national, regional and local knowledge and innovation dynamics. In particular, we highlight how the global scene is changing in the contemporary world economy that we char-acterize as a knowledge economy. We show how knowledge and knowledge dynamics is driving innovation in the large urban agglomerations in the old and in new industrialized countries with their concentrations of abilities and resources and their superior intra-regional and international geographical proximities. In relation to the large urban agglomerations we stress the role of (i) density and proximity externalities, (ii) the physical and cultural resource base of large cities, and (iii) the interactive dynamics related to learning and creativity.
    Keywords: Knowledge; innovation; space; agglomeration; proximity; learning; creativity; social networks
    JEL: O30 R11
    Date: 2014–06–11
  3. By: Rudiger Ahrend; Emily Farchy; Ioannis Kaplanis; Alexander C. Lembcke
    Abstract: This paper estimates agglomeration benefits based on city productivity differentials across five OECD countries (Germany, Mexico, Spain, United Kingdom, and United States). It highlights the relationship between cities’ governmental fragmentation and productivity, and represents the first empirical analysis of how metropolitan governance structures affect this relationship. The comparability of results in a multi-country setting is supported through the use of Functional Urban Areas – an internationally harmonised definition of cities based on economic linkages rather than administrative boundaries. In line with the previous literature, the analysis confirms that city productivity tends to increase with city size; doubling city size is found to be associated with an increase in productivity of between two and five percent. What is more, city productivity is positively associated with the population size of nearby cities. On the governance side, the paper finds that cities with fragmented governance structures tend to have lower levels of productivity. For a given population size, a metropolitan area with twice the number of municipalities is associated with around six percent lower productivity; an effect that is mitigated by almost half by the existence of a governance body at the metropolitan level.
    Keywords: productivity, governance, cities, agglomeration economies
    JEL: H73 R12 R23 R50
    Date: 2014–05–16
  4. By: S. Chandrasekhar (Indira Gandhi Institute of Development Research); Ajay Sharma (Indira Gandhi Institute of Development Research)
    Abstract: With an urbanization level of 31.16 percent in 2011, India is the least urbanized country among the top 10 economies of the world. In addition, unlike other countries, the transition of workforce out of agriculture is incomplete. This coupled with jobless growth in recent years has contributed to an increase in certain migration streams. While rural-rural migration continues to be the largest in terms of magnitude, we also document an increase in two-way commuting across rural and urban areas. Further, there are a large number of short term migrants and an increase in return migration rate is also observed.
    Keywords: Internal migration streams, Short term migration, Commuting, Return migration, Regional labour mobility
    JEL: R23 J61 O1
    Date: 2014–05
  5. By: Monica Brezzi; Paolo Veneri
    Abstract: Contemporary urban systems in OECD countries are structured around functional regions, which often overcome established city boundaries. Reading space in terms of functional regions allows assessing changes in urban hierarchies and spatial structures, including the polycentricity of urban systems at national, regional and metropolitan scale. By using a harmonised definition of functional urban areas in OECD countries, this paper first provides a sound definition of polycentricity at each spatial scale, highlighting for each of them the different links with policy. Second, it provides measures of polycentricity and explores the economic implications of different spatial structures. Results show that relatively more monocentric regions have higher GDP per capita than their more polycentric counterparts. At country level, on the other hand, polycentricity is associated with higher GDP per capita.
    Keywords: Spatial structure, polycentricity, urban system
    JEL: R11 R12 R14 R58
    Date: 2014–04–14
  6. By: Celbis M.G.; Nijkamp P.; Poot J. (UNU-MERIT)
    Abstract: We estimate the Anderson and van Wincoop model of trade by using the data on the bilateral export flows from 26 Turkish regions to 180 countries for the years 2002 through to 2010. Regional transportation and communication infrastructure capacity, the positioning of point infrastructure in a region, and geography are explicitly accounted for. Our results highlight that land infrastructure, air transport capacity, and private maritime infrastructure presence, together with the distance of regional economies to exit nodes such as ports and airports, are important determinants of export performance. Based on our preferred regression where multilateral resistance terms are accounted for, we estimate that increases in the current land infrastructure, air transport capacity, and number of private ports of 1 per cent increases exports approximately by 0.38 per cent, 0.14 per cent, and 0.045 per cent respectively. Keywords Infrastructure; trade; regions; transportation costs
    Keywords: Empirical Studies of Trade; Economic Development: Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure; Development Planning and Policy: Trade Policy; Factor Movement; Foreign Exchange Policy; General Regional Economics (includes Regional Data); Transportation Systems: General; Regional Development Planning and Policy;
    JEL: F14 O18 O24 R10 R40 R58
    Date: 2014
  7. By: Andres RODRIGUEZ-POSE (London School of Economics); Marco DI CATALDO (London School of Economics); Alessandro RAINOLDI (European Commission – JRC - IPTS)
    Abstract: Research and innovation strategies for smart specialisation (RIS3) are trying to introduce a new vision of innovation policy in European regions. However, the success of RIS3 policy measures is closely dependent on the capacity of regional government institutions to act as coordinators or facilitators of the interventions. The way in which institutional mechanisms govern innovation processes and provide incentives for the interaction between regional actors remains a largely unexplored area of scientific research. This policy note discusses the importance of sound institutional frameworks for the effectiveness of smart specialisation, presenting an econometric study that investigates the link between government institutions and innovation. The empirical results confirm the key role played by governance structures for technological advances at the regional level, suggesting that the greatest gains in innovative capacity from institutional reforms would be obtained in peripheral territories where the initial level of government quality is lower. This analysis has important implications for the identification of the necessary pre-requisites for successful RIS3 strategies in EU regions.
    Keywords: European cohesion policy, Structural Funds, smart specialisation, Innovation Union, Regional Policy, Institutional Framework, Coordination, Governance Structures
    Date: 2014–03
  8. By: Antonescu, Daniela
    Abstract: The regional development promotes the balanced development of the European Union and, similarly, in all member state is treated as an integral factor of the state economic and social policy. Also, it promotes the growth model proposed by the future Europe 2020 Strategy, including the necessity of meeting the societal challenges, and those related to employment in the regions and in the Member-States. The appraisal of the implementation of the regional policy, whose goals and priorities were defined in the national and European strategic documents, calls for a general and specific objectives and financial instruments of that policy. This article contains information’s and elements about the next programming period and future regional policy of the European Union, in context of economic and social cohesion and convergence. From the perspective of the Europe 2020 Strategy, the regions shall continue to attract differentiated support depending on their economic development level (GDP/per capita), as a clear distinction is made between “less developed” and “most developed” regions.
    Keywords: regional policy; region; Structural Fund
    JEL: F0 F00 R1 R11 R15
    Date: 2013–10–11
  9. By: Jurgen Brauer; Daniel Montolio; Elisa Trujillo
    Abstract: In addition to federal firearms legislation applicable to all firearms manufacturers operating in the United States, each of the 50 U.S. states has its own state, and sometimes additional municipal, firearms laws. Conceivably, the relative strictness or laxity of these laws influences location decisions by firearms manufacturers. We use diverse data sets covering the period 1986 to 2010 to exploit variations in state firearms laws to study the manufacturing location of well over 2,700 federally licensed firearms manufacturers. We find that state laws do matter for location but so do other variables. In a way, our findings are reassuring. The firearm industry is just another industry in that it responds to economic incentives and disincentives, of which relevant state laws are an example: They play but an incremental role at the decision-making margin.
    Keywords: United States, federal firearms laws, state firearms laws, firearms manufacturing, location analysis
    JEL: K23 L10 L52 L64 H73
    Date: 2014–04
  10. By: NAKATA Hiroyuki; SAWADA Yasuyuki; SEKIGUCHI Kunio
    Abstract: This paper reviews the impacts of natural disasters on firm location choice and real estate prices. More specifically, we first study if awareness of possible natural disasters affects location choice. Then, we investigate the impacts of natural disasters on land prices. We collect a unique micro dataset from firms operating in central Thailand, where firms located in the Chao Phraya flood plains incurred direct losses during the 2011 floods. The empirical evidence suggests that more firms located in the Chao Phraya flood plains were unaware of the flooding risk before the 2011 floods than those located elsewhere. The 2011 floods have substantially affected awareness among firms—in particular, firms incurred direct losses, and the changes in land prices suggest that an increasing number of firms have been choosing locations outside the flood plains in the aftermath of the 2011 floods.
    Date: 2014–06
  11. By: Giorgio FABBRI (EPEE et Department d'Economie, Université d'Evry - Val d'Essonne)
    Abstract: We introduce an AK spatial growth model with a general geographical structure. The dynamics of the economy is described by a partial differential equation on a Riemannian manifold. The morphology interacts with the spatial dynamics of the capital and is one determinant of the qualitative behavior of the economy. We characterize on the geographical structure the conditions that guarantee, in the long run, the convergence of the detrended capital across locations and those inducing spatial capital agglomeration
    Keywords: Dynamical spatial model; growth; agglomeration; convergence; infinite dimensional optimal control problems; Riemannian manifolds
    JEL: R1 O4 C61
    Date: 2014–05–30
  12. By: Martijn van den Berge; Anet Weterings
    Abstract: Within the smart specialisation programme, the European Commission urges regional policy-makers to assess their regional innovation potential and consider investing in the areas of eco-technologies taking into account the regions’ specific strengths and weaknesses. In evolutionary economic geography, several studies have shown that regional innovation is a path dependent process whereby new technologies develop out of the existing regional knowledge base. In this paper, we examine to what extent this is also the case for eco-innovation; if so, the existing technological structure of a region would be an important source of information for regional policymakers with respect to designing their eco-innovation policy agenda. Our results show that in EU-regions both the probability of developing eco-innovations and the number of patents in this field depends on the patents that have been developed in related fields in the region in prior years.
    Keywords: relatedness, technology space, regional branching, eco-technologies, EU
    JEL: C23 R11 Q55
    Date: 2014–06
  13. By: Louise KEMPTON (Newcastle University); John Goddard (Newcastle University); John Edwards (European Commission – JRC - IPTS); Fatime B. Hegyi (European Commission – JRC - IPTS); Susana Elena-Pérez (European Commission – JRC - IPTS)
    Abstract: Universities have a potentially pivotal role to play in the social and economic development of their regions. They are a critical ‘asset’ of the region; even more so in less favoured regions where the private sector may be weak or relatively small, and has low levels of research and development activity. Evidence shows that the successful mobilisation of the resources of a university can have a disproportionately positive effect on regional economies and achievement of comprehensive regional strategies. Universities can therefore play a key role by contributing to the design and implementation of S3 in a local learning and capacity building process. However there are some key underpinning principles that make smart specialisation distinctive from previous iterations of regional innovation strategy development, and it will be necessary to understand the implications of these for the actors in the process, including universities.
    Keywords: European Universities, European cohesion policy, Structural Funds, Smart Specialisation
    Date: 2014–05
  14. By: Juan Mauricio Ramírez; Yadira Díaz; Juan Guillermo Bedoya
    Abstract: La descentralización en Colombia fue concebida para mejorar el acceso de la población a los servicios sociales, reducir la pobreza y proveer bienestar en todo el territorio. Sin embargo, después de más de 20 años persiste una gran brecha social entre los municipios. Este trabajo examina los factores determinantes de la pobreza multidimensional a nivel municipal. En particular, se analiza el impacto de un proceso de descentralización basado en la delegación de la prestación de servicios sociales, junto con el aumento de transferencias subnacionales desde el Gobierno Central, sobre el logro de mininos sociales descritos por la tasa de pobreza y la brecha de pobreza multidimensional. Utilizamos un enfoque de variables instrumentales para tener en cuenta la endogeneidad que surge al evaluar el impacto de la descentralización fiscal sobre la privación multidimensional; al mismo tiempo se tiene en cuenta la interdependencia espacial de la privación entre los municipios mediante la implementación de un modelo espacial autorregresivo con perturbación espacial autorregresiva. Encontramos resultados estadísticamente significativos en todas las especificaciones probadas que confirman: primero, la existencia de spillovers espaciales de la privación entre municipios que deben tenerse en cuenta al diseñar intervenciones de política pública. Segundo, efectos causales de la descentralización sobre la brecha y la tasa de pobreza multidimensional. Escenarios contrafactuales de políticas de descentralización espacialmente diferenciadas muestran ser más eficaces que aquellas que ignoran el rol de los factores geográficos.
    Keywords: Descentralización, pobreza multidimensional, equidad, geografía económica, interdependencia espacial, Latino América, Colombia.Decentralization, multidimensional poverty, equity, economic geography, spatial interdependence, Latin America.
    Date: 2014–03–31
  15. By: Adrian Götting (IET/CESNOVA, FCT-Universidade Nova de Lisboa and University Duisburg-Essen)
    Abstract: Due to the decline of the heavy industries in the Ruhr region, the area has to reinvent itself. The orientation towards service industries proves to be a difficult task for the district and its population. This paper examines the challenges, problems and potentials of the Ruhr region against the backdrop of its economical history out of a sociological perspective. Thereby the economical situation and its outcome towards the population stand in the foreground of the paper.
    Keywords: Ruhr region, structural change, regional development, information technologies, migration, demographic change
    JEL: J11 O43 R52 R58 Y80
    Date: 2014–04
  16. By: Daniel Arribas-Bel (University of Birmingham); Peter Nijkamp (, VU University Amsterdam); Jacques Poot (University of Waikato)
    Abstract: Cultural diversity is a complex and multi-faceted concept. Commonly used quantitative measures of the spatial distribution of culturally-defined groups – such as segregation, isolation or concentration indexes – are often only capable of identifying just one aspect of this distribution. The strengths or weaknesses of any measure can only be comprehensively assessed empirically. This paper provides evidence on the empirical properties of various spatial measures of cultural diversity by using Monte Carlo replications of agent-based modeling (MC-ABM) simulations with synthetic data assigned to a realistic and detailed geographical context of the city of Amsterdam. Schelling’s classical segregation model is used as the theoretical engine to generate patterns of spatial clustering. The data inputs include the initial population, the number and shares of various cultural groups, and their preferences with respect to co-location. Our MC-ABM data generating process produces output maps that enable us to assess the performance of various spatial measures of cultural diversity under a range of demographic compositions and preferences. We find that, as our simulated city becomes more diverse, stable residential location equilibria are only possible when people, particularly minorities, become more tolerant. We test whether observed measures can be interpreted as revealing unobserved preferences for co-location of individuals with their own group and find that the segregation and isolation measures of spatial diversity are shown to be non-decreasing in increasing preference for within-group co-location, but the Gini coefficient and concentration measures are not.
    Keywords: cultural diversity, spatial segregation, agent-based model, Monte Carlo simulation
    JEL: C63 J15 R23 Z13
    Date: 2014–06

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