nep-geo New Economics Papers
on Economic Geography
Issue of 2018‒09‒03
nine papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. Hierarchically structured determinants and phase-related patterns of economic resilience – An empirical case study for European regions By Holtermann, Linus; Hundt, Christian
  2. Optimal Spatial Policies, Geography and Sorting By Pablo Fajgelbaum; Cecile Gaubert
  3. Knowledge intensive business services and urban areas: an analysis of localization and productivity on Italian data By valter di Giacinto; Giacinto Micucci; Alessandro Tosoni
  4. The Eurasian customs union and the economic geography of Belarus: A panel convergence approach By Celbis, Mehmet Guney; Wong, Pui-hang; Guznajeva, Tatjana
  5. Regional Inequality in China allowing for Spatial Cost-of-Living Differences: Evidence from a Hedonic Analysis of Apartment Prices By Chao Li; John Gibson
  6. Too Many Cooks Spoil the Broth? Geographic Concentration, Social Norms, and Knowledge Transfer By Di Stefano, Giada; A. King, Andrew; Verona, Gianmario
  7. U.S. State and Local Fiscal Policy and Economic Activity: Do We Know More Now? By Rickman, Dan S.; Wang, Hongbo
  8. Spatial Structural Change By Fabian Eckert; Michael Peters

  1. By: Holtermann, Linus; Hundt, Christian
    Abstract: Our paper seeks to provide empirical evidence for a spatial-temporal system of (short-term) regional resilience determinants. Based on groundwork from Martin (2012) and Martin and Sunley (2015), we employ a nested hierarchy of regional and national determinants to constitute the spatial dimension, while we model the temporal dimension through a resistance and a recovery phase. Utilising hierarchical panel data models for a sample of 22 European countries, we can confirm the presence of a spatial-temporal system as we find significant determinants at both spatial levels that are connected via cross-level interactions and reveal varying, if not opposing directions of influences across the sensitivity and recovery phase.
    Keywords: resilience, shocks, resistance and recovery, regional development, regional and national determinants, economic crisis, Europe
    JEL: C33 R11 R58
    Date: 2018–08–06
  2. By: Pablo Fajgelbaum; Cecile Gaubert (UC Berkeley)
    Abstract: We study optimal spatial policies in quantitative trade and geography frameworks with spillovers and sorting of heterogeneous workers. We rst characterize ecient spatial transfers and the labor subsidies that would implement them. Then, we quantify the aggregate and distributional eects of implementing these policies in the U.S. economy. Under homogeneous workers and constant-elasticity spillovers, a constant labor subsidy over space restores efficiency regardless of micro heterogeneity in fundamentals and trade costs. In that case, the quantification suggests that the observed spatial transfers in the U.S. are close to ecient. Spillovers across heterogeneous workers create an additional rationale for place-specific subsidies to attain optimal sorting. Under heterogeneous workers, the quantication suggests that optimal spatial policies may require stronger redistribution towards low-wage cities than in the data, reduce wage inequality in larger cities, weaken spatial sorting by skill, and lead to signicant welfare gains. Spillovers across dierent types of workers are a key driving force behind these results.
    Date: 2018
  3. By: valter di Giacinto (Bank of Italy); Giacinto Micucci (Bank of Italy); Alessandro Tosoni (Bank of Italy)
    Abstract: We analyse the geographic localization and the productivity of knowledge-intensive business services (KIBS) in Italy, using both census data and balance-sheet data at the firm level. We find that KIBS are generally agglomerated in urban areas where they attain significantly higher labour productivity levels. Urban productivity advantages are found to be strongly associated with the local availability of human capital and to standard proxies of Marshall-Arrow-Romer and Jacobs agglomeration economies. Forward demand linkages and some factors impacting on the thickness of the local labour market also appear to be relevant. On the whole, the set of explanatory factors considered could explain the entire urban productivity premium estimated for Italian KIBS firms.
    Keywords: knowledge-intensive business services (KIBS); urban areas; agglomeration economies.
    JEL: J24 L84 R30
    Date: 2018–07
  4. By: Celbis, Mehmet Guney (UNU-MERIT, and Piri Reis University); Wong, Pui-hang (UNU-MERIT); Guznajeva, Tatjana (Technopolis Group)
    Abstract: This study presents novel research on the economic geography of Belarus. The 118 regions of Belarus are examined in relation to the Eurasian Customs Union (EACU) through the period 2005-2014. Spatial clusters and outliers are identified and compared across the periods prior and after the establishment of the EACU. We observe that EACU membership corresponds to a slowdown in the process of regional economic convergence in Belarus, and intensified economic competition with a geographical dimension among regions. We also observe that urban regions have benefited more from the EACU than less urbanised areas.
    Keywords: Eurasian Customs Union, Belarus, convergence, spatial analysis, economic integration
    JEL: F15 F55 O47 R11 R12 R58
    Date: 2018–07–03
  5. By: Chao Li (University of Waikato); John Gibson (University of Waikato)
    Abstract: Studies of inequality in China typically ignore cost-of-living differences between areas. Under the Balassa-Samuelson effect, non-tradeables cost more in richer areas, so nominal inequality exceeds real inequality. This especially matters in China, where spatial cost-of-living differences should have increased with recent development of urban housing markets. We use new data on apartment prices in 104 major cities in China to develop housing-related spatial deflators. The level of spatial inequality in 2016 is overstated 27 percent if cost-of-living differences are ignored. A hedonic analysis of 41,000 individual apartment sales shows most price variation is between areas, rather than from features of individual apartments. The dominant trend in the reform era is for regional inequality in China to decline, contrary to common perceptions. In nominal terms, the Theil Index for inter-provincial inequality in 2016 is just 46 percent of its 1978 level, and in real terms the fall in inequality would be even greater.
    Keywords: China; housing; population; regional inequality; spatial deflators
    JEL: O47 Q56 R11
    Date: 2018–08–23
  6. By: Di Stefano, Giada; A. King, Andrew; Verona, Gianmario
    Abstract: A long tradition in social science research emphasizes the potential for knowledge to flow among firms co-located in dense areas. Scholars have suggested numerous modes for these flows, including the voluntary transfer of private knowledge from one firm to another. Why would the holder of valuable private knowledge willingly transfer it to a potential and closely proximate competitor? In this paper, we argue that geographic concentration has an effect on the expected compliance with norms governing the use of transferred knowledge. The increased expected compliance favors trust and initiates a process of reciprocal exchange. To test our theory, we use a scenario-based field experiment in gourmet cuisine, an industry in which property rights do not effectively protect knowledge and geographic concentration is common. Our results confirm our conjecture by showing that the expectation that a potential co-located firm will abide by norms mediates the relationship between geographic concentration and the willingness to transfer private knowledge.
    Keywords: Geographic Concentration; Density; Knowledge Transfer; Social Norms; Field Experiment; Hospitality Industry
    JEL: L10
    Date: 2016–10–25
  7. By: Rickman, Dan S.; Wang, Hongbo
    Abstract: Early reviews of the academic literature on the economic effects of state and local taxes and expenditures suggested that not enough was known upon which to base policy. The reviews called for better data and improvements in empirical methodology. This paper reviews studies conducted since the early literature reviews to assess our current state of knowledge. The conclusion of the study is that we know more now. But our knowledge is unlikely to ever be sufficient to provide universal policy guidance. Rather, we suggest that more research is needed on specific state and local policies for specific circumstances, consistent with the general principles that guide place-based policy.
    Keywords: State and local taxes; regional economic growth
    JEL: H2 H72 R12 R38
    Date: 2018–08–07
  8. By: Fabian Eckert (Yale University); Michael Peters (Yale University)
    Abstract: Abstract This paper studies the spatial implications of structural change. By shifting demand towards non-agricultural goods, the structural transformation benefits workers in urban centers and hurts rural locations. At the aggregate level, the economy can respond either through a reallocation of labor from rural to urban areas or through a reduction in agricultural employment within a given location. Using detailed spatial data for the U.S. between 1880 and 2000, we show that spatial reallocation accounts for almost none of the aggregate decline in agricultural employment. We interpret this fact through the lens of a novel quantitative theory of spatial structural change, and show that the absence of the spatial reallocation channel is primarily due to regional productivity shocks, which almost entirely offset the urban bias of the structural transformation. Frictions to labor mobility meanwhile are quantitatively unimportant. The model implies that spatial welfare differences declined substantially during the United States' structural transformation and that the spatial reallocation of factors can account for about 15% of aggregate growth since 1880.
    Date: 2018
  9. By: Anna Gerke (Audencia Recherche - Audencia Business School); Yan Dalla Pria (CeRSM - Centre de Recherche sur le Sport et le Mouvement - UPN - Université Paris Nanterre)
    Abstract: Sport clusters can be defined as geographical concentrations of private, public, and non-profitorganizations in a denominated area with a shared interest in one or similar sports. This paper addresses the following question: how does socioeconomic proximity – linkages between organizations or individuals which go beyond spatial proximity – influence the development and properties of sport clusters? This qualitative study investigates four sport clusters in surfing and sailing. The findings indicate that there are two types of sport clusters based on different forms of socioeconomic proximity. The surfing clusters are characterized by cognitive proximity based on convergent perceptions and managerial practices. The sailing clusters are characterzed by organizational proximity based on complementarity. This article (1) discusses the resilience properties of these two types of clusters and (2) proposes a two-step model of cluster development. This research has implications for policy makers and cluster members by showing that clusters should be considered to be social constructions that go through different stages.
    Keywords: sport cluster,socioeconomic proximity,resilience
    Date: 2017–06–21

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