nep-geo New Economics Papers
on Economic Geography
Issue of 2015‒07‒11
eleven papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. Location choice of German multinationals in the Czech Republic : the importance of agglomeration economies By Hecht, Veronika
  2. Related variety in Chinese cities: local and Foreign Direct Investment related variety and impacts on urban growth By Junsong Wang; Martha Prevezer
  3. Spatial Dependence in Regional Business Cycles: Evidence from Mexican States By Keisuke Kondo
  4. Spatial Distribution of Disposal Sites¦ Empirical Evidence from Japan By Yuichi Ishimura; Kenji Takeuchi
  5. Key Enabling Technologies and Smart Specialization Strategies. European Regional Evidence from patent data By Sandro Montresor; Francesco Quatraro
  6. The more the merrier? Migration and Convergence among European Regions By Lorenz B. Fischer; Michael Pfaffermayr
  7. The persistence of local joblessness By Michael Amior; Alan Manning
  8. Does Persistence in Start-up Activity Reflect Persistence in Social Capital? By Michael Fritsch; Michael Wyrwich
  9. Differentiated property tax and urban sprawl in Italian urbanized areas By Ermini, Barbara; Santolini, Raffaella
  10. Population Density, Fertility, and Childcare Services From the Perspective of a Two-Region Overlapping Generations Model By Ishida, Ryo; Oguro, Kazumasa; Yasuoka, Masaya
  11. Standortanforderungen von Internet-Start-ups: Eine diskursanalytische Untersuchung am Beispiel der Internetökonomie in Berlin By Hufner, Daniel; Mossig, Ivo

  1. By: Hecht, Veronika (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "This paper analyses the location choice of German investors in the Czech Republic based on a unique dataset covering all Czech companies with a German equity holder in 2010. The identification of the regional determinants of foreign direct investment (FDI) location is an important regional policy issue as FDI is supposed to improve the labour market conditions of the host region. Using a nested logit approach the impact of agglomeration economies, labour market conditions and distance on the location choice decision is investigated. The main result of the paper is that apart from a low distance to the location of the parent company the attractiveness of a Czech district for German investors is mainly driven by agglomeration economies. Besides localisation economies the agglomeration of German companies in a region plays a decisive role. The importance of labour market characteristics differs between investment sectors, sizes and periods." (Author's abstract, IAB-Doku) ((en))
    Keywords: Standortfaktoren, Standortwahl - Determinanten, Herkunftsland, Investitionsverhalten, Auslandsinvestitionen, Arbeitsmarkt, Tschechische Republik, Bundesrepublik Deutschland, Bundesrepublik Deutschland
    JEL: F23 R12 R30
    Date: 2015–07–02
  2. By: Junsong Wang; Martha Prevezer
    Abstract: The paper measures agglomeration economies through related variety and their impact on growth and employment in Chinese cities, using prefecture level city-industry data from 2003 to 2010.
    Keywords: Related variety; Jacobs externalities; FDI-knowledge spillovers; Urban growth in China
    JEL: O2 R1
    Date: 2015–06
  3. By: Keisuke Kondo (Research Institute of Economy, Trade and Industry)
    Abstract: This paper investigates how a region-specific shock propagates outward toward neighboring regions when regional business cycles are spatially dependent. For this purpose, we model business cycles by introducing a spatial autoregressive process into a Markov switching model. The advantage of this model is that it enabled us to numerically simulate spatial spillover effects. Therefore, we were able to demonstrate how the economic crisis in 2008–2009 spread across Mexican states. We found that business cycles across these states were spatially dependent and that a regime switch from expansion to recession caused conditions in the neighboring economies to deteriorate.
    Keywords: Spatial dependence, Spatial spillover effects, Regional business cycles, Markov switching model, Markov chain monte carlo
    JEL: C33 E32
    Date: 2015–07
  4. By: Yuichi Ishimura (Graduate School of Economics, Kobe University); Kenji Takeuchi (Graduate School of Economics, Kobe University)
    Abstract: This study is an empirical investigation of the location of industrial waste disposal sites in Japan. We found some evidence of spatial concentration of industrial waste disposal sites in area with other waste-related facilities. In addition, we found a higher number of industrial waste disposal sites per capita in municipalities that had not experienced conflict relating to the construction of disposal sites. Our results suggest that companies may decide to locate disposal sites in areas in which other waste related facilities already exist and/or where there is less citizen conflict over their construction. This would explain why there is a spatial concentration of unwanted facilities in some areas.
    Keywords: Disposal site; Industrial waste; Spatial econometrics; NIMBY
    JEL: D72 Q53 R39
    Date: 2015–06
  5. By: Sandro Montresor (Kore University of Enna); Francesco Quatraro (University of Turin)
    Abstract: The paper aims at investigating whether Key Enabling Technologies (KETs) can have a role in facilitating 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 show a positive impact on the construction of new RTAs, pointing to a new “enabling” role for them. KETs also exert a negative moderating role on the RTAs impact of the density of related pre-existing technologies, 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.
    Keywords: Key Enabling Technologies; Smart Specialization Strategies; Revealed Technological Advantages
    JEL: R11 R58 O31 O33
    Date: 2015
  6. By: Lorenz B. Fischer; Michael Pfaffermayr
    Abstract: Using a spatial systems estimator to incorporate spatial interactions and endogeneity of income levels and migration, this paper finds a positive effect of migration on cohesion within the European Union on the NUTS 2 level. As migration can generally be observed from low to high income regions, growth rates of income per worker tend to decrease in regions experiencing net immigration, while lagging regions experience higher speeds of income convergence. As a result, migration increases sigma-convergence. Results show an increase of more than one third. Free movement of persons also proves to increase efficiency, displayed by higher average convergence speeds.
    Keywords: Conditional spatial beta- and sigma-convergence, Migration, Spatial Solow model, European regions
    JEL: R11 C31 O47
    Date: 2015–07
  7. By: Michael Amior; Alan Manning
    Abstract: Local differences in US employment-population ratios and unemployment rates have persisted over many decades. Using decennial census data from 1950-2010, we investigate the reasons for this. The persistence cannot be explained by permanent differences in amenities, local demographic composition or the propensity of women to work. Population does respond strongly to differences in economic fortunes, although these movements are not large enough to eliminate shocks within a decade. Over the longer run, persistence in local joblessness is largely explained by serial correlation in the demand shocks themselves.
    Keywords: Local labor markets; unemployment; inactivity; internal migration; commuting
    JEL: J61 J64 R23
    Date: 2015–06
  8. By: Michael Fritsch (School of Economics and Business Administration, Friedrich-Schiller-University Jena); Michael Wyrwich (School of Economics and Business Administration, Friedrich-Schiller-University Jena)
    Abstract: Emerging literature shows that spatial differences in entrepreneurship tend to persist over longer periods of time. A potential mechanism underlying this pronounced persistence is that high levels of start-up activity lead to the emergence of a regional culture and a supporting environment in favor of entrepreneurship that particularly involves social capital. This chapter summarizes the available empirical evidence on the regional persistence of entrepreneurship and elaborates in detail how different elements of such a culture, such as social capital, can exert an influence on the level of new business formation and self-employment. As a demonstration for the relevance of a regional entrepreneurship culture for new business formation, we highlight the case of Germany where we find pronounced persistence of start-up activity despite radical structural and institutional shocks over the course of the 20th century. The German case suggests that there is a long-lasting local culture of entrepreneurship that can survive disruptive changes. We discuss the relationship between place-specific social capital and a regional culture of entrepreneurship and draw policy conclusions.
    Keywords: Entrepreneurship, social capital, economic development, self-employment, new business formation, entrepreneurship culture, institutions
    JEL: L26 R11 O11
    Date: 2015–07–07
  9. By: Ermini, Barbara; Santolini, Raffaella
    Abstract: City’s core and suburbans tax differentials can affect sprawl within an urban area. We empirically address this issue by analyzing the pattern of growth of 72 Italian urbanized areas. As a novelty, we investigate the causes of the emerging land development pattern. Our results show that density of urban area declines in response to an increase in the city’s core property tax rate. We find that this effect is due to changes in dwelling size. By contrast, density of urban area significantly rises when suburbans property tax rates increase, making the urban area more compact. This effect is attributable to changes in the improvement effect of property taxation.
    Keywords: differentiated property tax, urban sprawl, functional urban area
    JEL: H3 H30 H71 R1 R10 R14
    Date: 2015–07
  10. By: Ishida, Ryo; Oguro, Kazumasa; Yasuoka, Masaya
    Abstract: In countries confronting the issue of low fertility, as Japan is, dual trends showing higher regional population density associated with lower fertility rates are being confirmed. It is therefore an important theme for analysis to deepen discussions related to reducing regional fertility disparities by increasing fertility through the implementation of comprehensive childcare support policies, which might facilitate the striking of a balance between child-rearing and work, even in highly populated regions. As described herein, we constructed a simple theoretical two-region Overlapping Generations (OLG) by incorporating migration and land prices. Using it, we analyzed effects of population density and childcare services on fertility. Results elucidated the following three points. First, in the presence of congestion costs associated with increased population density, the fertility rate of the region decreases with increased population density. However, if the time cost of child-rearing is brought down by raising the level of the childcare services provided in the region, then the effect of increased population density on fertility can be restrained. Second, when the effect of population size on productivity is less than a certain level, improvement in the childcare services raises the relative ratio of the population density. When the effect of population size on productivity exceeds a certain level, however, the relative ratio of the population density decreases if the relative ratio of the time cost of child-rearing decreases as a result of childcare service reform. Third, where each region imposes payroll tax on its residents and uses its tax revenue as the financial resources to adopt a decentralized strategy of providing childcare services to its region, the level of childcare services that maximizes the utility of a representative agent in each region is independent of the childcare services of any other region. Therefore, manipulation of the level of childcare services becomes a dominant strategy.
    Keywords: population density, fertility, congestion, migration, childcare services, overlapping generation (OLG)
    JEL: H40 J13 J61 R10 R12 R23
    Date: 2015–06
  11. By: Hufner, Daniel; Mossig, Ivo
    Abstract: Sie nennen sich Soundcloud, Researchgate, 6Wunderkinder oder Zalando - junge Gründer, die das Internet im Rahmen ihrer Geschäftsideen auf vielfältige Weise nutzen, zieht es nach Berlin. Nationale Gründerstatistiken zeigen, dass sich Internetunternehmen nirgendwo besser gründen lassen als in Berlin, Hamburg oder München. Allerdings finden Hamburg und München in der medialen Berichterstattung kaum Beachtung. Mit viel Hysterie und Enthusiasmus rufen Medien und Blogs stattdessen die Bundeshauptstadt als Start-up-Metropole der Zukunft aus. Doch warum ist das so? Wonach suchen digitale Existenzgründer in Berlin, was sie an anderen IT-Gründerhochburgen wie Hamburg oder München nicht finden? Warum konzentrieren sich Web- und Softwareunternehmen an einem Standort wie diesen? Antworten darauf gibt eine diskursanalytische Untersuchung der drei wichtigsten deutschsprachigen Gründer-Blogs. Die Ergebnisse zeigen, dass Berlin spezielle Standortansprüche der Gründer von Internetunternehmen bedient. Insgesamt identifiziert die Diskursanalyse drei zentrale Anforderungsbereiche: Die lokale Verfügbarkeit von Wagniskapital, die dortige Internationalität sowie ein szene-basiertes Ökosystem und sozio-kulturelles Raumangebot.
    Abstract: They call themselves Soundcloud, Researchgate, 6Wunderkinder or Zalando - young entrepreneurs with an affinity to the web prefer to move to Berlin. National founder statistics reveal: Nowhere else can internet companies be better established than in Berlin, Hamburg or Munich. However, Hamburg and Munich don't draw that much attention in the broad medial discussion about growing startup-cities. Instead, with a lot of hysteria and enthusiasm mass media and blogs proclaim Berlin as the start-up capital of the future. But what's the matter? What are the internet start-ups especially looking for in Berlin? Why do web- and software companies concentrate at specific locations? Answers will be given by a discourse analysis of three important german-speaking start-up-blogs. The results illustrate that foundings of internet companies are based on specific requirements on locations such as Berlin. Overall, the discourse analysis identifies three main requirements: The local availability of venture capital, a location with international structures as well as a community-based ecosystem and sociocultural space.
    Keywords: Startups,Internet,Standortanforderungen,kreative urbane Milieus,Diskursanalyse,Berlin,startups,internet,location requirements,creative urban milieu,discourse analysis
    Date: 2014

This nep-geo issue is ©2015 by Andreas Koch. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.