nep-geo New Economics Papers
on Economic Geography
Issue of 2014‒09‒25
fourteen papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. Another View of Sprawl from Space By Joseph DeSalvo; Qing Su
  2. Spatial Wage Inequality and Technological Change By Charlotte Senftleben-Koenig; Hanna Wielandt; ;
  3. Creativity, Education or What? On the Measurement of Regional Human Capital By Eckhardt Bode; Lucia Perez Villar
  4. Cities, Wages, and the Urban Hierarchy By Juan D. Soto; Dusan Paredes
  5. Taxes in Cities By Marius Brülhart; Sam Bucovetsky; Kurt Schmidheiny
  6. One policy, many policies: the spatial allocation of first and second pillar CAP Expenditure By Camaioni, Beatrice; Esposti, Roberto; Pagliacci, Francesco; Sotte, Franco
  7. Determinants of Urban Sprawl: A Panel Data Approach By Joseph DeSalvo; Qing Su
  8. Travel Distance and Fuel Efficiency: An Estimation of the Rebound Effect using Micro-Data in Switzerland By Sylvain Weber; Mehdi Farsi
  9. The Influence of Neighborhood Characteristics on Wages and Labor Supply in an Urban Context: The Case of a Latin-American City By Leonardo Fabio Morales; Lina Cardona-Sosa
  10. Rethinking borders in a mobile world: An alternative model By Olivier Walther; Denis Retaillé
  11. A Spatial Analysis to evaluate the Farm's structure and the Geography of Rural Areas: The case study of Mugello Area By Landi, Chiara; Fastelli, Laura; Rovai, Massimo; Andreoli, Maria
  12. On the Finite Sample Properties of Pre-test Estimators of Spatial Models By Gianfranco Piras; Ingmar R. Prucha
  13. The Geographical Spread and the Economic Impact of Food Harvest 2020 – A Regional Perspective By Mary Carey; Cathal O'Donoghue
  14. The Energy Implications of City Size and Density By Anthony M. Yezer; William Larson

  1. By: Joseph DeSalvo (Department of Economics, University of South Florida); Qing Su (Department of Marketing, Economics and Sports Business, Northern Kentucky University)
    Abstract: Burchfield, et al., “Causes of Sprawl: A Portrait from Space,” Quarterly Journal of Economics, CXXI (2006), 587–633, show that variables chosen from the monocentric model and its generalizations as well as those capturing geographical and political characteristics of urban areas are important in explaining urban sprawl, as measured by an index of the amount of undeveloped land around an average dwelling. Although Burchfield, et al., draw on the urban monocentric model and its extensions, they do not, with one exception, employ the exogenous variables of that model. On the other hand, with one recent exception, urban economists do not use geographical and political characteristics to explain sprawl, defined as the spatial size of the urban area. We were interested, therefore, in seeing if combining these two sets of variables better explains these two measures of sprawl. The main findings of this paper are (1) the standard monocentric model variables fail to contribute to an explanation of the sprawl index, (2) these variables are, however, very important in explaining the spatial size of urban areas, and (3) the Burchfield, et al., variables contribute to an explanation of the spatial size of urban areas. We conclude with a summary and some comments on the role of theory in providing empirically testable hypotheses. We call for efforts to develop a theory comparable to the monocentric model to explain the Burchfield, et al. (2006), measure of sprawl.
    JEL: R12 R13 R14
    Date: 2013–11
  2. By: Charlotte Senftleben-Koenig; Hanna Wielandt; ;
    Abstract: During the last decades, wage inequality in Germany has considerably increased both within and across regions. Building on concepts of the task-based approach, this paper studies whether and to what extent these developments are driven by technological change. We present novel evidence that technological change is positively related to intra-regional wage inequality. This is driven by increases in the compensation for non-routine cognitive tasks that are prevalent at upper percentiles of the wage distribution combined with decreases in the compensation for non-routine manual tasks, which are located at lower percentiles. Because there exists substantial variation in the degree of technology exposure across German regions, technological change can also explain part of the rise in inter-regional wage inequality.
    Keywords: Spatial Changes, Wage Inequality, Job Tasks, Technological Change
    JEL: J31 O33 R23
    Date: 2014–08
  3. By: Eckhardt Bode; Lucia Perez Villar
    Abstract: This paper substantiates the debate following Richard Florida’s suggestion to measure regional human capital by creative occupations rather than education. Consistent with Florida’s notion of creativity, it suggests a microfoundation that relates creativity to workers’ cognitive and noncognitive skills. It shows that this microfoundation is similar to that of human capital in recent labor economics, which has facilitated important new insights. It also shows that Florida’s measure is too crude to make a difference. Nonethe-less, it is time to rethink regional human capital. Occupations may help project workers’ cognitive and noncognitive skills from the micro to the regional level
    Keywords: Human Capital, Education, Creativity, Cognitive Skills, Noncognitive Skills, Occupation, Regional Wages, Regional Growth
    JEL: I21 I25 J24 R12 R23
    Date: 2014–09
  4. By: Juan D. Soto (Department of Economics, Universidad Católica del Norte); Dusan Paredes (Regional Economics Application Laboratory, University of Illinois)
    Abstract: We present evidence regarding the unequal spatial distribution of population in the north and south of Chile which implies that even when geographical distances to the main urban center are similar, the distances in a context of urban hierarchy are completely di?erent. Given this economic geography, we postulate that Central Place Theory provides a better understanding for the study of city size wage gap in Chile. In order to test our hypothesis, we construct ?ve tiers of urban hierarchy using the 2002 National Census and then contrast the e?ect generated by the urban hierarchy on worker wages using nine waves of the National Socioeconomic Characterization Survey (CASEN).
    Keywords: Labor productivity, amenities, urban hierarchy.
  5. By: Marius Brülhart; Sam Bucovetsky; Kurt Schmidheiny
    Abstract: Most cities enjoy some autonomy over how they tax their residents, and that autonomy is typically exercised by multiple municipal governments within a given city. In this chapter, we document patterns of city-level taxation across countries, and we review the literature on a number of salient features affecting local tax setting in an urban context. Urban local governments on average raise some ten percent of total tax revenue in OECD countries and around half that share in non-OECD countries. We show that most cities are highly fragmented: urban areas with more than 500,000 inhabitants are divided into 74 local jurisdictions on average. The vast majority of these cities are characterized by a central municipality that strongly dominates the remaining jurisdictions in terms of population. These empirical regularities imply that an analysis of urban taxation needs to take account of three particular features: interdependence among tax-setting authorities (horizontally and vertically), jurisdictional size asymmetries, and the potential for agglomeration economies. We survey the relevant theoretical and empirical literatures, focusing in particular on models of asymmetric tax competition, of taxation and income sorting and of taxation in the presence of agglomeration rents.
    Keywords: cities; taxes; tax competition; fiscal federalism; agglomeration; sorting
    JEL: H71 H73 R28 R51
    Date: 2014–08
  6. By: Camaioni, Beatrice; Esposti, Roberto; Pagliacci, Francesco; Sotte, Franco
    Abstract: The Common Agricultural Policy (CAP) is the most important EU Policy in terms of total expenditure. Nevertheless, its impact on EU-27 regions is rather uneven: actually, some regions have historically received a larger support than others. Territorial imbalances, however, represent only part of the story. The CAP comprises a wide range of agricultural and rural measures, from agricultural market interventions to agro-environmental payments and rural development measures. Due to their underlying objectives, expenditures from different CAP Pillars are allocated according to different territorial patterns at local level. In this paper, CAP real expenditures for years 2007-2011 are analysed at EU-27 NUTS 3 level, by considering expenditure intensity per hectare of utilised agricultural area (UAA). Several CAP expenditure typologies (Direct Payments, Market Intervention Measures and RDP’s Axes, i.e., Axis 1, Axis 2 and Axis 3) are considered. Their spatial allocation highlights different territorial patterns and suggests the existence of well defined spatial clusters. They seem to be determined by the nature of CAP itself. Indeed, despite being a single EU policy, the heterogeneous nature of its measures and their spatial allocation make the CAP a combination of several territorial policies.
    Keywords: CAP, rural development, regional patterns, Agricultural and Food Policy, Community/Rural/Urban Development, O18, Q01, R58,
    Date: 2014
  7. By: Joseph DeSalvo (Department of Economics, University of South Florida); Qing Su (Department of Marketing, Economics and Sports Business, Northern Kentucky University)
    Abstract: This paper employs panel-data estimation approaches to test hypotheses of the monocentric urban model. We apply both within- and between- groups estimation approaches to urbanized area data for the 1990-2010 period. From a fixed-effects (within-groups) model, we find that a 1-percent increase in population or a 1-percent decrease in travel costs expands the urbanized area by 1.05 percent or 0.52 percent, respectively. The impact of household income on urban spatial size is negative, contrary to the theoretical prediction. Similar findings of the impact of population and travel costs are obtained from the between-groups estimation. While the impact of household income is negative in the fixed effect-model, its impact is ambiguous in the between-groups estimation. The between-groups estimation also indicates that geographic and political factors help explain spatial size differences across urbanized areas. Spatial size is larger with a higher percentage of the urban fringe overlying aquifers, a higher percentage of local revenues from intergovernmental transfers, a lower elevation range in the urban fringe, and a lower number of restaurants and bars per 1000 people.
    Keywords: urban sprawl, panel data, within-groups estimation, between-groups estimation
    Date: 2013–11
  8. By: Sylvain Weber (Institute of economic research IRENE, Faculty of Economics, University of Neuchâtel, Switzerland); Mehdi Farsi (Institute of economic research IRENE, Faculty of Economics, University of Neuchâtel, Switzerland)
    Abstract: We estimate the rebound effect for private transportation using cross-section micro-level data in Switzerland for 2010. Our simultaneous equations model accounts for endogeneity of travel distance, vehicle fuel intensity and vehicle weight. Compared to the literature, our paper provides an important contribution as micro-level data and simultaneous equations models have seldom been used to estimate the rebound effect. Moreover, among the distance measures we use, one is highly reliable as it was recorded using GIS (Geographical Information System) software. Our results, obtained by 3SLS, point to substantial direct rebound effects between 75% and 81%, which lie at the higher end of the estimates found in the literature. OLS estimates are however much lower and seem to under-estimate the rebound effect.
    Keywords: Rebound effect, Travel demand, Simultaneous equations model.
    JEL: C31 D12 Q41 R41
    Date: 2014–09
  9. By: Leonardo Fabio Morales; Lina Cardona-Sosa
    Abstract: Using data from Medellín, second largest city in Colombia, we asses in this paper how a set of neighborhood characteristics determines wages and labor supply for workers in the city. We use GIS data to construct measures of the quality of environments where workers live. This paper focuses in the impact in labor supply and wages of the following set of characteristics: availability of public transportation, crime levels and density of economic activity. The empirical methodology consist of the estimation of linear equations for wages and worked hours, and we control for the selection of individuals into the neighborhoods they are observed. In order to do this we estimate in a first stage a probabilistic model of neighborhood selection from which selection correction terms are obtained; these correction terms and included in the linear equations for wage and worked hours in a second stage. In addition, we control for sample selection as well. We find that the endogeneity of the location decision tends to overestimate the magnitude of the effect of neighborhood characteristics on labor market outcomes. Nevertheless, the effect of some characteristics is still significant and important after we control for the possibility of selection into neighborhoods. Classification JEL: J01, J22, O18, R21.
    Date: 2014–09
  10. By: Olivier Walther (Department of Border Region Studies, University of Southern Denmark); Denis Retaillé (ADES Laboratory, University of Bordeaux)
    Abstract: The purpose of this exploratory article is to conceptualize the new types of boundaries born of globalization. The first part of the article summarizes the unique territorial characteristics of States and the methods that they use to affect international flows through control over their own national borders. The second section elaborates the fundamentals of an alternative model that is not reliant, as is classical spatial analysis, on points, lines and surfaces to represent movement. The article then presents three types of limits: the confines, the threshold and the horizon, which result from the divergence, convergence or intersection of flows.
    Keywords: space, mobility, borders, places, networks, globalization
    JEL: R10
    Date: 2014–05
  11. By: Landi, Chiara; Fastelli, Laura; Rovai, Massimo; Andreoli, Maria
    Abstract: In order to promote rural development public agricultural policies need to constantly adapt to the continuous change of socio-economic conditions of rural areas, related to both farm and territorial dynamics. Hence beyond the zoning provided by the European Commission and developed by Member States [art. 11 Reg. Ce 1698/2005], policy makers should take into account geography, farms characteristics and farmers attitude to acquire a deeper knowledge of these rural areas. This paper aims at supporting the design of proper agricultural policies focusing on the case-study of Mugello territory, a rural area located in the North of Tuscany, which includes both: intermediate rural areas and areas with development problems. This purpose is firstly pursued by generating a geo-referenced database able to develop a deeper analysis on the existing interactions between socio - economic attributes of farms, land use and agricultural policies. The study combined several sources of data: the 2010 Italian Agriculture Census, the Tuscany Regional Agency for Payments in Agriculture (ARTEA) database, and cover land data from the database Corine Land Cover (CLC-06), as updated to 2007 by LaMMA (Laboratory for Environment Monitoring and Modeling). The resulting sample is composed by 821 farms operating in the Mugello area which are split in four different farm styles according to their level of multifunctionality and enterpreunership capacity. Results show that Mugello territory is characterized by an internal differentiation, that determines the prevalence of different farm structure according to the sub-areas characteristics. Especially analyzing the distribution of payments related to area with development problems we note that there are still margins of improvement.
    Keywords: Rural development, Farm and Territorial Data, Rural Development Program, Spatial Analysis, Agricultural and Food Policy, Community/Rural/Urban Development, Q12, Q18,
    Date: 2014
  12. By: Gianfranco Piras (Regional Research Institute, West Virginia University); Ingmar R. Prucha (Department of Economics, University of Maryland)
    Abstract: This paper explores the properties of pre-tst strategies in estimating a linear Cliff-Ord -type spatial model when the researcher is unsure about the nature of the spatial dependence. More specifically, the paper explores the finite sample properties of the pre-test estimators introduced in Florax et al. (2003), which are based on Lagrange Multiplier (LM) tests, within the context of a Monte Carlo study. The performance of those estimators is compared with that of the maximum likelihood (ML) estimator of the encompassing model. We find that, even in a very simple setting, the bias of the estimates generated by pre-testing strategies can be very large in some cases and the empirical size of tests can differ substantially from the nominal size. This is in contrast to the ML estimator.
    Keywords: cliff-ord, spatial, model, lagrange multiplier, monte carlo
    JEL: C4 C5
    Date: 2013–10
  13. By: Mary Carey (PhD student in Public Policy, School of Economics, University College Dublin, Ireland); Cathal O'Donoghue (Rural Economy and Development Programme, Teagasc, Athenry, Co. Galway, Ireland)
    Abstract: Recently the agri-food sector has received increased attention in Ireland. The agri-food sector has been the traditional backbone of Irish exports, and despite the economic downturn Irish exports in this sector grew by an impressive 12 percent in 2011 (CSO 2012). The agri-food sector is regarded as Ireland’s largest indigenous industry, the potential of the sector in terms of exports, and its heavy dependence on domestic inputs are the key reasons for the increased attention. The real economic value of the agri-food sector in Ireland is analysed at national, and most importantly for this paper, at regional level. This paper examines the impact of the agri-food sector in addressing regional disparities in Ireland. The estimation of the true value of the agri-food sector is evaluated at regional level by analysing Gross Value Added, employment levels and productivity rates for the sector expressed in percentage of regional values. Gross-Value-Added in absolute terms and as a percentage of regional Gross-Value- Added provides us with a more thorough understanding of the regional importance of certain industries within the sector. In terms of employment, the rural context of the agri-food sector is discussed, including the geographical spread of the sector. A comparison of regional productivity levels is analysed at national and regional level. In addition, this paper geographically distributes the change in output and employment if the four main sector specific Food Harvest 2020 targets are achieved. As a preliminary contour of the agri-food sector in Ireland this research will be useful to all the key players in the sector.
    Keywords: Regional Development Policy, Agri-food sector, Regional Economics
    Date: 2013
  14. By: Anthony M. Yezer (Department of Economics/Institute for International Economic Policy, George Washington University); William Larson (Bureau of Economic Analysis)
    Abstract: This paper develops a new urban simulation model with endogenous population, housing supply and demand, and highway use and congestion. These features allow the model to simulate cities of different sizes with a single parameterization and hence to study the partial effect of city size differences on economic activity. The model is applied to the important problem of the energy implications of city size and density. Energy consumption in housing and commuting is calculated based on the structure type and size of housing units, consumption of a numeraire good, and commuting distances and velocities on congested roadways. The surprising conclusion is that per capita energy consumption does not vary as city size increases. Households in larger cities consume less housing, commute longer (and slower), and consume more of the numeraire good. The energy use implications of these eff ects are offsetting for a laissez-faire city. However, common land use policies, speciï¬cally density limits and greenbelts, can positively or negatively affect both city welfare and the elasticity of energy use with respect to city size.
    Keywords: urban simulation, congestion, commuting, gasoline, greenbelt
    JEL: Q40 R14
    Date: 2014

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