nep-geo New Economics Papers
on Economic Geography
Issue of 2019‒01‒14
eight papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. Trade Liberalization and the Agglomeration of Heterogeneous Entrepreneurs By Forslid, Rikard; Okubo, Toshihiro
  2. Economic Geography, Growth Dynamics and Human Capital Accumulation in Turkey: Evidence from Regional and Micro Data By Burhan Can Karahasan; Firat Bilgel
  3. Robust Tests for Convergence Clubs By Corrado, L.; Stengos, T.; Weeks, M.; Ege Yazgan, M.
  4. Linking content and technology: On the geography of innovation networks in the Bergen media cluster By Martin, Roman; Rypestøl , Jan Ole
  5. Technological Diversification and Smart Specialization: the role of cooperation By Artur Santoalha
  6. Space and the Environment: An Introduction to the Special Issue By Batabyal, Amitrajeet; Folmer, Henk
  7. Firm Productivity and Agglomeration Economies: Evidence from Egyptian Data By Karim Badr; Reham Rizk; Chahir Zaki
  8. Regionale Disparitäten und Regionalpolitik: Treiber der Veränderung, Handlungsbedarf und Handlungsoptionen By Pflüger, Michael P.

  1. By: Forslid, Rikard; Okubo, Toshihiro
    Abstract: This paper introduces spatial sorting of heterogeneous entrepreneurs (firms) in the 'footloose entrepreneur' trade and geography model. The model generates agglomeration from a uniform space contrary to the 'footloose capital' model. The model also generates spatial sorting in reverse productivity order with the least productive entrepreneur being the first to relocate.
    Keywords: agglomeration; Heterogeneous Firms; trade liberalization
    JEL: F12 F15 R12
    Date: 2018–12
  2. By: Burhan Can Karahasan (Piri Reis University); Firat Bilgel
    Abstract: This study explores the endogenous relationship among market access, wages and human capital accumulation in Turkey. Our first set of analyses tests the impact of market access on human capital development using regional data at the NUTS III level. Results, robust to the inclusion of spatial spillovers, regional structural differences in production, possible endogeneity issues and the unobserved regional heterogeneities, validate that regions with better access to markets are the ones that accumulate more human capital in Turkey. Our second set of analyses aims to explore the background of human capital accumulation by using individual level data, which allows us to combine market accessibility, returns to education (wages) and human capital development. Remarkably, once we include wages and treat it as endogenous, we find evidence that the impact of market access on human capital development diminishes. Overall, the findings of this study validate that background of the NEG model does not work in line with the expectations. Rather the influence of geographical proximity on wages and individual’s decision on human capital investment are not identical.
    Date: 2018–10–10
  3. By: Corrado, L.; Stengos, T.; Weeks, M.; Ege Yazgan, M.
    Abstract: In many applications common in testing for convergence the number of cross-sectional units is large and the number of time periods are few. In these situations asymptotic tests based on an omnibus null hypothesis are characterised by a number of problems. In this paper we propose a multiple pairwise comparisons method based on an a recursive bootstrap to test for convergence with no prior information on the composition of convergence clubs. Monte Carlo simulations suggest that our bootstrap-based test performs well to correctly identify convergence clubs when compared with other similar tests that rely on asymptotic arguments. Across a potentially large number of regions, using both cross-country and regional data for the European Union we find that the size distortion which afflicts standard tests and results in a bias towards finnding less convergence, is ameliorated when we utilise our bootstrap test.
    Keywords: Multivariate stationarity, bootstrap tests, regional convergence.
    JEL: C51 R11 R15
    Date: 2018–12–21
  4. By: Martin, Roman (Gothenburg University); Rypestøl , Jan Ole (University of Agder)
    Abstract: This paper deals with the geography of innovation networks and analyses combinatorial knowledge dynamics from a single cluster perspective. Addressing firms in the media cluster in Bergen, Norway, we examine how and from where companies acquire and combine different types of knowledge for their innovation activities. The empirical analysis, which is based on structured interviews with 22 media companies, identifies two main types of cluster firms: media content providers that rely heavily on symbolic knowledge and media technology providers that draw mostly on synthetic knowledge. Even though they draw on different knowledge bases, the two types of firms are strongly interlinked in their innovation activities and source knowledge from each other. Furthermore, we find that synthetic firms constitute a gateway to the regional R&D system and that the region acts as key arena for the combination of dissimilar knowledge bases.
    Keywords: innovation networks; knowledge bases; creative industries; new media; Norway
    JEL: L82 O14 O30 O31
    Date: 2019–01–07
  5. By: Artur Santoalha (TIK Centre, University of Oslo)
    Abstract: Smart Specialization is closely associated with the concept of diversification. For better understanding of Smart Specialization, this article investigates one novel explanatory factor of technological diversification: cooperation (distinguishing between cooperation within regions and cooperation between regions). Using OECD REGPAT data on patents co-applications, the empirical analysis measures the role of cooperation between institutions on technological diversification in 226 European regions over 10 periods of 5 years each, 2000–2013. Although cooperation within and between regions is important as a determinant of regional diversification, both forms of cooperation should evolve hand in hand – singly, each form of cooperation may prove ineffective for boosting regional diversification.
    Date: 2019–01
  6. By: Batabyal, Amitrajeet; Folmer, Henk
    Abstract: We have two objectives in this special issue. First, we bring together in one place, original research that sheds light on the ways in which the notion of “space” affects the conceptualization of natural resource and environmental problems. Second, given this conceptualization, we show how rigorous modeling of natural resource and environmental problems that explicitly accounts for space overcomes some of the shortcomings of non-spatial analysis. Following this introductory paper, there are six additional papers in this issue. Each of these papers discusses a particular research question at the interface of what we call “space and the environment.”
    Keywords: Biased and Inconsistent Estimators, Environment, Modeling, Natural Resources, Space, Welfare
    JEL: Q50 R11
    Date: 2018–12–04
  7. By: Karim Badr (World Bank); Reham Rizk; Chahir Zaki
    Abstract: This paper attempts to shed light on the nexus between firm productivity and economies of agglomeration in Egypt. Using a large dataset of 62,108 firms in 342 four-digit activities in 27 regions governorates, we introduce three measures of agglomeration, which are urbanization or firm diversification, measured by the number of firms in the governorate, localization and specialization, measured by the average productivity in the governorate and sector (generating externalities and knowledge spillovers), and finally competition, measured by the number of firm operating in the same governorate and the same sector. We find strong evidence for the existence of agglomeration economies in Egypt after controlling for firm age, location, economic activity and legal status. In the Egyptian context, productivity spillovers gained from agglomeration economies outweighed the negative effects of congestion implied by our competition measure. The latter is chiefly due to the lack of good infrastructure. When regressions are run by firm size and activity, our main findings show, first, that micro and small firms are more likely to benefit from localization and diversification compared to medium and large firms. Finally, service firms benefit more from a high level of diversification, while manufacturing firms gain more from knowledge spillovers and specialization. Our results support promoting entrepreneurship through the creation of industrial clusters located outside Cairo to lessen disparities between regions and acquire the full advantages of agglomeration.
    Date: 2018–10–15
  8. By: Pflüger, Michael P. (University of Würzburg)
    Abstract: Die ungleiche Entwicklung von Städten und Regionen steht gegenwärtig nicht nur in Deutschland im Brennpunkt gesellschaftlicher und politischer Aufmerksamkeit. Die Sorge vor einem weiteren Aufreißen der Lücken zwischen Stadt und Land und zwischen Gewinner- und Verliererregionen des Strukturwandels sitzt tief und damit auch die Sorge vor sozialen und politischen Verwerfungen. Vor diesem Hintergrund widmet sich dieser Beitrag drei Fragen. Wie lässt sich die Entwicklung von Städten und Regionen erklären? Was sind zentrale Treiber der Regionalentwicklung? Was soll und was kann Regionalpolitik leisten?
    Keywords: cities and regions, regional gaps and inequalities, spatial equilibrium, local labor markets, regional disparities, regional and place-based policies
    JEL: R1 R5 J2 H2
    Date: 2019–01

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