nep-geo New Economics Papers
on Economic Geography
Issue of 2015‒04‒11
thirteen papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. From Periphery to Core: Measuring Agglomeration Effects Using High-Speed Rail By Gabriel M. Ahlfeldt; Arne Feddersen
  2. Neighbor regions as the source of new industries By Ron Boschma; Víctor Martín; Asier Minondo
  3. Exploring the Geography of China's Airport Networks during 1980s-2000s: A Hybrid Complex-Network Approach By Zhengbin Dong; Wenjie Wu
  4. Determinants of intra-distribution dynamics in European regions: An empirical assessment of the role of structural intervention By Enrico Fabrizi; Gianni Guastella; Stefano Marta; Francesco Timpano
  5. It's all in the Mail: The Economic Geography of the German Empire By Florian Ploeckl
  6. Retail Agglomeration and Competition Externalities: Evidence from Openings and Closings of Multiline Department Stores in the US By John M. Clapp; Stephen L. Ross; Tingyu Zhou
  7. Does technological progress affect the location of economic activity ? By TABUCHI, Takatoshi; THISSE, Jacques-François; ZHU, Xiwei
  8. The influence of clusters on economic development. A comparative analysis of cluster policy in the European Union and Japan By Katarzyna Cheba
  9. The Cost of Knowledge. By Antonelli, Cristiano; Colombelli, Alessandra
  10. Equilibrium commuting By Berliant, Marcus; Tabuchi, Takatoshi
  11. Do Key Enabling Technologies shape regional Smart Specialization Strategies? A patent based analysis of European data By Sandro Montresor; Francesco Quatraro
  12. A Global Vector Autoregression (GVAR) model for regional labour markets and its forecasting performance with leading indicators in Germany By Schanne, Norbert
  13. Non-nested testing of spatial correlation By Miguel A. Delgado; Peter Robinson

  1. By: Gabriel M. Ahlfeldt; Arne Feddersen
    Abstract: We analyze the economic impact of the German high-speed rail (HSR) connecting Cologne and Frankfurt, which provides plausibly exogenous variation in access to surrounding economic mass. We find a causal effect of about 8.5% on average of the HSR on the GDP of three counties with intermediate stops. We make further use of the variation in bilateral transport costs between all counties in our study area induced by the HSR to identify the strength and spatial scope of agglomeration forces. Our most careful estimate points to an elasticity of output with respect to market potential of 12.5%. The strength of the spillover declines by 50% ever 30 minutes of travel time, diminishing to 1% after about 200 minutes. Our results further imply an elasticity of per-worker output with respect to economic density of 3.8%, although the effects seem driven by worker and firm selection.
    Keywords: Accessibility, agglomeration, high-speed rail, market potential, transport policy
    JEL: R12 R28 R38 R48
    Date: 2015–03
  2. By: Ron Boschma; Víctor Martín; Asier Minondo
    Abstract: The development of new industries demands access to local capabilities. Little attention has yet been paid to the role of spillovers from neighbor regions for industrial diversification, nor has the role of network linkages between neighbor regions been investigated. As the spread of capabilities has a strong geographical bias, we expect regions to develop new industries in which their neighbor regions are specialized. To test this hypothesis, we analyze the development of new industries in US states during the period 2000-2012. We show that an US state has a higher probability of developing a comparative advantage in a new industry if a neighbor state is specialized in that industry. We also show that neighbor US states have more similar export structures. This export similarity seems to be explained by higher social connectivity between neighbor states, as embodied in their bilateral migration patterns.
    Keywords: new industries, regional branching, diversification, knowledge spillovers, US, regions, exports
    JEL: R11 N94 O14
    Date: 2015–03
  3. By: Zhengbin Dong; Wenjie Wu
    Abstract: Air networks are normal examples of transportation systems among ubiquitous big data networks in dynamic nature. This is particularly the case in developing countries with rapid airport network expansions. This paper explores the structure and evolution of the trunk airport network of China (ANC) in major years during 1980s-2000s. We generalise the complex network approach developed in existing studies and further test for statistical properties of weighted network characteristics by using pair-wise traffic flows. We find that ANC is a small-world network in which (i) the number of airflight connections and (ii) the number of shortest paths going through a given airport city meet the densification law, however, its degree distribution does not follow power-law statistics like other countries' airport networks. The spatiotemporal decomposition of network metric plots and the visualization maps leads to a rich harvest of stylized ANC structures: (i) national hub-and-spoke patterns surrounding mega-cities; (ii) regional broker patterns surrounding Kunming and Urumqi, and (iii) local heterogeneous disparity patterns in isolated geographical cities, such as Lhasa, Lijiang, Huangshan, etc. These findings have important implications towards understanding the geo-political and economic forces at stake in shaping China's urban systems.
    Keywords: Airport system, complex network, regional development, China
    JEL: O18 R12 P25
    Date: 2015–03
  4. By: Enrico Fabrizi (DISCE, Università Cattolica); Gianni Guastella (DISCE, Università Cattolica); Stefano Marta (UN FAO); Francesco Timpano (DISCE, Università Cattolica)
    Abstract: This paper looks at the dynamic of income distribution in European regions and attempts to relate movements within the distribution to the regional structural characteristics and the support of Cohesion Policy (CP). Empirical evidence highlights two main features of regional development. A generally lagging periphery with high growth rates on the one hand and a set of leading regions facing the challenge of global competitiveness on the other. There is evidence that CP support advanced economic development in lagging and peripheral regions, hence contributing to the “convergence objective”. Nonetheless, effective catch-up remains circumscribed to certain very few regions. Contrarily, CP support has failed to stimulate growth potential in leading regions, failing to strengthen EU competitiveness. Evidence presented in this paper provides useful insights for the current debate about the reshaping of EU cohesion policy toward a more place-based approach.
    Keywords: Regional development, European Unione,distribution dynamics, multinomial logisticregression, cohesion policy, place-based territorial policies.
    JEL: Q47 R11
    Date: 2014–07
  5. By: Florian Ploeckl (School of Economics, University of Adelaide)
    Abstract: Information exchange is a necessary prerequisite for economic exchange over space. This relationship implies that information exchange data corresponds to the location of economic activity and therefore also of population. Building on this relationship we use postal data to analyse the spatial structure of the population distribution in the German Empire of 1871. In particular we utilize local volume data of a number of postal information transmission services and a New Economic Geography model to create two index measures, Information Intensity and Amenity. These variables respectively influence the two mechanisms behind the urban population distribution, namely agglomeration forces and location endowments. By testing the influence of actual location characteristics on these indices we identify which location factors mattered for the population distribution and show that a number of characteristics worked through both mechanisms. The model is then used to determine counterfactual population distributions, which demonstrate the relative importance of particular factors, most notably the railroad whose removal shows a 34% lower urban population. A data set of large locations for the years 1877 to 1895 shows that market access increases drove the magnitude of the increase in urban population, while endowment changes shaped their relative pattern.
    Date: 2015–04
  6. By: John M. Clapp (University of Connecticut); Stephen L. Ross (University of Connecticut); Tingyu Zhou (Concordia University)
    Abstract: From the perspective of an existing retailer, the optimal size of a cluster of retail activity represents a trade-off between the marginal increases in consumer attraction from another store against the depletion of the customer base caused by an additional competitor. We estimate opening and closing probabilities of multi-line department stores (“anchors”) as a function of pre-existing anchors by type of anchor store (low-priced, mid-priced or high-priced) using a bias corrected probit model with county and year fixed effects. We find strong negative competitive effects of an additional same type but no effect on openings of anchors of another type.
    Keywords: Multi-line Department Stores, Shopping Centers, Openings, Closings, Bias-Corrected Probit
    JEL: D43 L1 L21 L81 R1 R3 R12 R33
    Date: 2015–04
  7. By: TABUCHI, Takatoshi (University of Tokyo, Faculty of Economics and Research Institute of Economics, Trade & Industry); THISSE, Jacques-François (Université catholique de Louvain, CORE, Belgium; NRU-Higher School of Economics, Russia; CEPR); ZHU, Xiwei (Center for Research of Private Economy and School of Economics, Zhejiang University)
    Abstract: We show that how technological innovations and migration costs interact to shape the space-economy. Regardless of the level of transport costs, rising labor productivity fosters the agglomeration of activities, whereas falling transport costs do not affect the location of activities. When labor is heterogeneous, the number of workers residing in the more productive region increases by decreasing order of productive efficiency when labor productivity rises. This process affects in opposite directions the welfare of those who have a lower productivity.
    Keywords: new economic geography, technological progress, labor productivity, migration costs, labor heterogeneity
    JEL: J61 R12
    Date: 2014–11–18
  8. By: Katarzyna Cheba (West Pomeranian University of Technology in Szczecin)
    Abstract: The development of clusters seems to be a natural consequence of the observed trends in the global economy. The increased interest in the creation and development of clusters can also be seen in most of the countries of the European Union, however, the experience of EU countries in this field is different. In addition to strong clusters with a long tradition, new clusters are created with much lower potential. Clusters compatible with the most important EU documents are to play the role of organizations supporting regional development and ensuring the growth of innovation of the European Union in the new programming period. Japanese economy is based on the important role of clusters in this area, which along with the US and the European Union is among the largest economies in the world. The experience of Japan in this area is much longer. A lot of still functioning clusters were created in this country in the XVII and XVIII centuries. The aim of this study is a comparative analysis of the socio-economic situation of the European Union and Japan, with special emphasis on the role, that clusters play in those economies. The result of the analysis is to identify the factors that allow for the effective operation of enterprises within created cluster structures. The analysis of Japan's experience in this area is a valuable source of information for policy guidelines developed to support clusters in the EU.
    Keywords: cluster, effectiveness of clusters, regional development, value of regions
    JEL: O12 O57
    Date: 2015–04
  9. By: Antonelli, Cristiano; Colombelli, Alessandra (University of Turin)
    Abstract: This paper contributes the economics of knowledge and innovation with the analysis of the knowledge cost function and sheds light on the determinants of the large variance in the cost of innovation across firms. The amount and the structure of external knowledge and the internal stocks of knowledge that firms can access and use in the generation of new technological knowledge help firms to reduce the costs of innovations. The empirical section is based upon a panel of companies listed on UK and the main continental Europe financial markets (Germany, France and Italy) for the period 1995 – 2006, for which information about patents have been gathered. The econometric analysis of the costs of knowledge considers the unit costs of patents on the right hand side, and on the left hand side next to R&D expenditures, the stock of knowledge internal and external to each firm. In order to articulate the different facets of the external knowledge that is made accessible by proximity with firms co-localized in the same region (NUTS2), we further include other variables proxying for regional variety, complementarity and similarity. The results confirm that the stock of internal knowledge and the access to external knowledge play a key role in reducing the actual cost of the generation of new technological knowledge at the firm level.
    Date: 2014–10
  10. By: Berliant, Marcus; Tabuchi, Takatoshi
    Abstract: We consider the role of the nonlinear commuting cost function in determination of the equilibrium commuting pattern where all agents are mobile. Previous literature has considered only linear commuting cost, where in equilibrium, all workers are indifferent about their workplace location. We show that this no longer holds for nonlinear commuting cost. The equilibrium commuting pattern is completely determined by the concavity or convexity of commuting cost as a function of distance. We show that a monocentric equilibrium exists when the ratio of the firm agglomeration externality to commuting cost is sufficiently high. Finally, we find empirical evidence of both long and short commutes in equilibrium, implying that the commuting cost function is likely concave.
    Keywords: Commuting
    JEL: R13 R41
    Date: 2015–04–07
  11. By: Sandro Montresor; Francesco Quatraro (University of Turin)
    Abstract: The paper focuses on the analysis of effects of Key Enabling Technologies (KETs) on regional Smart Specialisation Strategies (S3). Drawing on the economic geography approach to S3, we formulate some hypotheses about the impact that KETs-related knowledge can have on the construction of new regional technological advantages (RTAs). By crossing regional data on patent applications, in KETs-mapped classes of the International Patent Classification (IPC), with a number of regional economic indicators, we test these hypotheses on a panel of 26 European countries over the period 1980-2010. KETs positively affect the construction of new RTAs, pointing to a new “enabling” role for them. They also mitigate the impact of the density to related pre-existing technologies on the construction of new RTAs, pointing to the KETs capacity of making the latter less binding in pursuing S3. Overall, the net-impact of KETs is positive, pointing to a new case for plugging KETs in the S3 policy tool-box.
    Date: 2015–03
  12. By: Schanne, Norbert (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "It is broadly accepted that two aspects regarding the modeling strategy are essential for the accuracy of forecast: a parsimonious model focusing on the important structures, and the quality of prospective information. Here, we establish a Global VAR framework, a technique that considers a variety of spatio-temporal dynamics in a multivariate setting, that allows for spatially heterogeneous slope coefficients, and that is nevertheless feasible for data without extremely long time dimension. Second, we use this framework to analyse the prospective information regarding the economy due to spatial co-development of regional labour markets in Germany. The predictive content of the spatially interdependent variables is compared with the information content of various leading indicators which describe the general economic situation, the tightness of labour markets and environmental impacts like weather. The forecasting accuracy of these indicators is investigated for German regional labour-market data in simulated forecasts at different horizons and for several periods. Germany turns out to have no economically dominant region (which reflects the polycentric structure of the country). The regions do not follow a joint stable long run trend which could be used to implement cointegration. Accounting for spatial dependence improves the forecast accuracy compared to a model without spatial linkages while using the same leading indicator. Amongst the tested leading indicators, only few produce more accurate forecasts when included in a GVAR model, than the GVAR without indicator. IAB-" (Author's abstract, IAB-Doku) ((en))
    Keywords: Prognosegenauigkeit, Prognosemodell, regionale Faktoren, Indikatorenbildung
    JEL: C23 E24 E27 R12
    Date: 2015–03–30
  13. By: Miguel A. Delgado; Peter Robinson
    Abstract: We develop non-nested tests in a general spatial, spatio-temporal or panel data context. The spatial aspect can be interpreted quite generally, in either a geographical sense, or employing notions of economic distance, or when parametric modelling arises in part from a common factor or other structure. In the former case, observations may be regularly-spaced across one or more dimensions, as is typical with much spatio-temporal data, or irregularly-spaced across all dimensions; both isotropic models and non-isotropic models can be considered, and a wide variety of correlation structures. In the second case, models involving spatial weight matrices are covered, such as “spatial autoregressive models”. The setting is sufficiently general to potentially cover other parametric structures such as certain factor models, and vector-valued observations, and here our preliminary asymptotic theory for parameter estimates is of some independent value. The test statistic is based on a Gaussian pseudo-likelihood ratio, and is shown to have an asymptotic standard normal distribution under the null hypothesis that one of the two models is correct; this limit theory rests strongly on a central limit theorem for the Gaussian pseudo-maximum likelihood parameter estimates. A small Monte Carlo study of finite-sample performance is included.
    JEL: C12 C21
    Date: 2015–03

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