nep-geo New Economics Papers
on Economic Geography
Issue of 2018‒12‒03
thirteen papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. The geographical dimension of structural change By Ron Boschma
  2. Scaling of Atypical Knowledge Combinations in American Metropolitan Areas from 1836 to 2010 By Lars Mewes
  3. Spinoffs, parents, and institutions: Evidence from the Italian motorcycle industry By Andrea Morrison
  4. EUREGIO: The construction of a global IO DATABASE with regional detail for Europe for 2000-2010 By Mark Thissen; Maureen Lankhuizen; Frank (F.G.) van Oort; Bart Los; Dario Diodato
  5. Is There a Kuznets Curve for Intra-City Earnings Inequality? By Haixiao Wu
  6. Top Lights: Bright cities and their contribution to economic development By Bluhm, Richard; Krause, Melanie
  7. Does institutional quality matter for trade? Institutional conditions in a sectoral trade framework By Álvarez, Inmaculada C.; Barbero, Javier; Rodríguez-Pose, Andrés; Zofío, José L.
  8. The Determinants of Resilience in European Regions During the Great Recession: a Bayesian Model Averaging Approach By Lisa Gianmoena; Vicente Rios
  9. Time-varying congestion tolling and urban spatial structure By Takayama, Yuki
  10. How Do Regional Price Levels Affect Income Inequality? Household-level Evidence From 21 Countries By Petr Janský; Marek Šedivý
  11. About the Origin of Cities By de Palma,; Papageorgiou, Yorgos Y.; Thisse, Jacques-François; Ushchev, Philip
  12. Mobilising European Structural and Investment Funds and Horizon 2020 in support of innovation in less developed regions By Dimitrios Pontikakis; Mathieu Doussineau; Nicholas Harrap; Mark Boden
  13. Konzeptualisierung zwischenstaatlicher Interdependenzen als Netzwerke By Lischka, Michael; Mossig, Ivo

  1. By: Ron Boschma
    Abstract: This chapter explores patterns of structural change from a geographical perspective. It summarizes recent insights on the geography of structural change, and in particular on regional diversification. It shows how local capabilities and institutions impact on structural change, and why the capacity of regions to diversify differs substantially. This chapter describes how concepts like diversification and relatedness have been fruitfully combined in a rapidly expanding literature. Diversification refers to the emergence of new activities, an important feature of structural change. These new activities are often embedded in, or related to, existing activities at the national and regional scale, requiring similar capabilities. But new activities can also be unrelated to existing ones. For our understanding of structural change, the role of agency is considered crucial, as it shapes diversification at the regional level.
    Keywords: structural change, product space, regional diversification, related diversification, unrelated diversification, institutions, agency
    JEL: O18 R0 R11
    Date: 2018–11
  2. By: Lars Mewes
    Abstract: Cities are epicenters for invention. Scaling analyses have verified the productivity of cities and demonstrate a super-linear relationship between cities? population size and invention performance. However, little is known about what kinds of inventions correlate with city size. Is the productivity of cities only limited to invention quantity? We shift the focus on the quality of idea creation by investigating how cities influence the art of knowledge combination. Atypical combinations introduce novel and unexpected linkages between knowledge domains. They express creativity in inventions and are particularly important for technological breakthroughs. Our study of 174 years of invention history in metropolitan areas in the United States (US) reveals a super-linear scaling of atypical combination with population size. The observed scaling grows over time indicating a geographic shift towards cities since the early 20th century. The productivity of large cities is thus not only restricted to quantity, but also includes quality in invention processes.
    Keywords: Atypical Knowledge Combination, Cities, Historic Patent Data, Invention; Scaling Analysis
    JEL: O30 O31 O33 R11
    Date: 2018–11
  3. By: Andrea Morrison
    Abstract: In this paper we study the impact of spinoff generation events on the performance of parent organizations. Using data from the Italian motorcycle industry (1893-1993), we find that parents have higher survival chances after a spinoff generation event, confirming results from previous studies about other manufacturing industries. We also show that these enhanced survival patterns differ across time and space, and we link these effects to institutional differences: spinoff generation did not determine any survival advantage for parent firms in the Fascist era and in the Turin cluster, while it had an additional positive effect in the Motorvalley cluster. The paper contributes to the literature on spinoff generation and employee mobility and adds to the debate on the role of institutions in evolutionary economic geography, by showing the importance of contextual factors for the performance of parent firms.
    Keywords: Spinoffs, Employee entrepreneurship, Parents, Institutions, Evolutionary economic geography
    JEL: B52 L26 O18 R11
    Date: 2018–11
  4. By: Mark Thissen (Netherlands Environmental Assessment Agency (PBL)); Maureen Lankhuizen (Vrije Universiteit Amsterdam); Frank (F.G.) van Oort (Erasmus University Rotterdam); Bart Los (University of Groningen); Dario Diodato (Harvard Kennedey School)
    Abstract: This paper introduces the EUREGIO database: the first time-series (annual, 2000-2010) of global IO tables with regional detail for the entire large trading bloc of the European Union. The construction of this database, which allows for regional analysis at the level of so-called NUTS2 regions, is presented in detail for its methodology and applications. The tables merge data from WIOD (the 2013 release) with, regional economic accounts, and interregional trade estimates developed by PBL Netherlands Environmental Assessment Agency, complemented with survey-based regional input-output data for a limited number of countries. All used data are survey data and only non-behavioral assumptions have been made to estimate the EUREGIO dataset. These two general rules of data construction allow empirical analyses focused on impacts of changes in behavior (of economies, firms, policies) without endogenously having this behavior embedded already by construction. The tables are publicly available to the research community, from the Dutch government open data website. In this project, both a regional trade database, and production and consumption data of different actors in different regions, were used. The focus is thus intentionally on the regionalization of both trade and the regional use and supply of products by different economic actors. The paper is organized around the successive steps of the data construction: (1) adjustment of WIOD, (2) regional information, (3) Construction of tables, (4) conclusions on the usefulness of this type of regional IO tables with an overview of current applications of the EUREGIO database.
    Keywords: Input-output analysis; European regions; trade; relatedness
    JEL: P25 R13 R15 F14 F15
    Date: 2018–11–16
  5. By: Haixiao Wu (George Washington University)
    Abstract: Many papers have found a positive relation between income inequality and city size in the US and other countries. This literature has assumed that the relation is linear. Tests performed here find that it is concave, resembling the classic Kuznets curve. A theoretical model based on the Income Elasticity Hypothesis (IEH), explains that inequality is a concave function of housing prices that tend to increase with city size. Further tests confirm the concavity of the relation between Gini and housing costs that is predicted by the IEH. Although for most cities, inequality still rises with housing costs, if housing costs continue to grow in large cities, inequality should eventually fall, resembling the Kuznets Curve at the country level.
    JEL: R12 R23 D3 O15
    Date: 2018–09
  6. By: Bluhm, Richard (Institute of Macroeconomics, Leibniz University Hannover, and UNU-MERIT); Krause, Melanie (Hamburg University, Department of Economics)
    Abstract: Tracking the development of cities in emerging economies is difficult with conventional data. We show that satellite images of nighttime lights are a reliable proxy for economic activity at the city level, provided they are first corrected for topcoding. The commonly-used data fail to capture the true brightness of many cities. We present a stylized model of urban luminosity and empirical evidence which both suggest that these 'top lights' can be characterized by a Pareto distribution. We then propose a simple correction procedure which recovers the full distribution of city lights. Our results show that the brightest cities account for nearly a third of global economic activity. Applying this approach to cities in Sub-Saharan Africa, we find that primate cities are outgrowing secondary cities but are changing from within. Poorer neighborhoods are developing, but sub-centers are forming so that Africa's largest cities are also becoming increasingly fragmented.
    Keywords: Development, urban growth, night lights, top-coding, inequality
    JEL: O10 O18 R11 R12
    Date: 2018–11–05
  7. By: Álvarez, Inmaculada C.; Barbero, Javier; Rodríguez-Pose, Andrés; Zofío, José L.
    Abstract: This article examines the extent to which national institutional quality affects bilateral sectoral trade flows, as well as whether the conditioning role of institutions for trade has been waxing or waning with time. Based on a new trade theory framework, we derive a sectoral gravity equation, including novel variables corresponding to the exporter’s labour competitiveness levels, along with importer’s price indices and sectoral incomes, and analyse industry specific bilateral trade flows of 186 countries for the period 1996-2012. We address potential endogeneity and econometric drawbacks by means of Poisson Pseudo-Maximum Likelihood estimation methods. The results indicate that both the institutional conditions at destination and the institutional distance between exporting and importing countries are relevant factors for bilateral trade. Moreover, the effect associated to institutional conditions at destination moderately increases over time. This is a robust outcome across economic sectors, with higher values for agriculture and raw materials than for manufacturing and services.
    Keywords: international trade; gravity equation; institutional quality; public policy
    JEL: R14 J01
    Date: 2018–03–01
  8. By: Lisa Gianmoena; Vicente Rios
    Abstract: This study analyzes the determinants of resilience outcomes of European regions during the 2008-2013 crisis. Bayesian Model Averaging techniques are used in order to examine the empirical relevance of a large number of institutional, innovation, socio-demographic and labor market factors that could affect resilience patterns. The findings of this study suggest that regional disparities in resilience patterns are mainly determined by factors such as regional quality of government, the level of innovation, the functional specialization and by national level labor market institutions. The findings are robust to (i) the definition of the dependent variable and the (ii) employment of different g-priors and priors on model size.
    JEL: O11 C23 C11
    Date: 2018–07–01
  9. By: Takayama, Yuki
    Abstract: This study develops a model in which heterogeneous commuters choose their residential locations and departure times from home in a monocentric city with a bottleneck located at the entrance to the central business district (CBD). We systematically analyze the model by utilizing the properties of complementarity problems. This analysis shows that, although expanding the capacity of the bottleneck generates a Pareto improvement when commuters do not relocate, it can lead to an unbalanced distribution of benefits among commuters: commuters residing closer to the CBD gain and commuters residing farther from the CBD lose. Furthermore, we reveal that an optimal time-varying congestion toll alters the urban spatial structure. We then demonstrate through examples that (a) if rich commuters are flexible, congestion tolling makes cities denser and more compact; (b) if rich commuters are highly inflexible, tolling causes cities to become less dense and to spatially expand; and (c) in both cases, imposing a toll helps rich commuters but hurts poor commuters.
    Keywords: time-varying congestion toll; bottleneck congestion; urban spatial structure; heterogeneity
    JEL: D62 R21 R41 R48
    Date: 2018–11–15
  10. By: Petr Janský; Marek Šedivý
    Abstract: Regional differences in prices levels are substantial in many countries, but little is known about how important they are for income inequality and relative poverty. To bridge this gap, we provide new evidence on the basis of the best available data and a novel two-step approach. First, we collect the largest cross-country dataset of regional price level estimates from 12 countries and use it to predict regional price levels in other countries. We then combine all these regional prices levels with household-level data from the Luxembourg Income Study, which gives us results for a final sample of 21 countries. We find that for some countries Gini coefficients and headcount poverty ratios are statistically significantly different when adjusted for regional price levels. For example, we show that adjusting for regional price levels would lower the Gini coefficients by 2% for Italy, 3% for Columbia and by 4% for Georgia, while it would increase the headcount poverty ratio by 6% for France and by 7% for Ireland. We conclude that regional price levels affect income inequality to a varying extent and should be taken into account by policy makers and in future research.
    JEL: O18 R11 R58
    Date: 2018–10
  11. By: de Palma,; Papageorgiou, Yorgos Y.; Thisse, Jacques-François; Ushchev, Philip
    Abstract: We provide a bare--bones framework that uncovers the circumstances which lead either to the emergence of equally-spaced and equally-sized central places or to a hierarchy of central places. We show how these patterns reflect the preferences of agents and the efficiency of transportation and communication technologies. Under one class of agents, the economy is characterized by a uniform distribution or by a periodic distribution of central places having the same size. Under two asymmetric classes of agents, the interaction between agents may give rise to a hierarchy of settlements with one or several primate cities.
    Date: 2018–09
  12. By: Dimitrios Pontikakis (European Commission - JRC); Mathieu Doussineau (European Commission - JRC); Nicholas Harrap (European Commission - JRC); Mark Boden (European Commission - JRC)
    Abstract: How can EU policies support the development of innovation capabilities in less developed regions? This note examines the mobilisation of the EU’s two major innovation support instruments: the European Structural and Investment Funds (ESIF) and Horizon 2020 (H2020). Using data from Eurostat and European Commission administrative data on ESIF and H2020 funding, we observe a number of salient patterns: While newer member states benefit from higher research and innovation allocations from ESIF, participation in H2020 remains a formidable challenge. Across Europe we find that H2020 participation is closely associated with a number of proxies of the development of national and regional innovation systems. With few exceptions (most notably Slovenia and the Czech Republic) newer member states are characterised by lower overall R&D intensity, their research and innovation systems are less internationalised and most R&D is performed by public research institutions rather than businesses. Based on a review of literature on the determinants of participation in the H2020 (and its predecessor Framework Programmes), the history of today's advanced innovation systems and a consideration of the objectives of, modes of intervention of and possible complementarities between ESIF and H2020 we single out international collaboration and business innovation capabilities as important instrumental objectives for development-minded policy.
    Keywords: Synergies, Horizon 2020, ESIF, Innovation
    Date: 2018–11
  13. By: Lischka, Michael; Mossig, Ivo
    Abstract: Zwischenstaatliche Interdependenzen werden als wichtiges Charakteristikum der wirtschaftlichen Globalisierung benannt, jedoch hat eine systematische Begriffsbestimmung bislang nur unzureichend stattgefunden. Während die Transnationalen Unternehmen als aktiv handelnde Akteure im Zentrum der Forschungen stehen, werden politische Akteure insbesondere auf der Ebene der Nationalstaaten eher passiv als rahmengebende Instanzen gesehen, welche die ökonomischen Handlungen der Wirtschaftsakteure (de-) regulieren und dadurch nur indirekt ökonomische Globalisierungsprozesse beeinflussen. Erkenntnisse darüber, welche zwischenstaatlichen Interdependenzen sich aus den sozioökonomischen Verflechtungen ergeben, die wiederum politische Handlungsspielräume beeinflussen, tragen maßgeblich dazu bei, Globalisierungsprozesse besser als bislang zu verstehen. Unter Einbezug relationaler Raumkonzepte der Wirtschaftsgeographie sowie Ansätzen aus der Politikwissenschaft soll der Interdependenzbegriff geschärft und operationalisiert werden. Darauf aufbauend werden konzeptionelle Überlegungen vorgestellt, die die Bedeutung zwischenstaatlicher Interdependenzen für den wirtschaftsgeographischen Globalisierungsdiskurs herausstellen. Abschließend werden bisherige Versuche beleuchtet, zwischenstaatliche Interdependenzen empirisch zu erfassen, um die Soziale Netzwerkanalyse als geeignete Methode zur Erfassung zwischenstaatlicher Interdependenzen zu diskutieren.
    Date: 2018

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