nep-geo New Economics Papers
on Economic Geography
Issue of 2019‒06‒10
seventeen papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. The regional significance of university locations in Lower Saxony By Stöver, Britta
  2. Inter-City Spillover and Intra-City Agglomeration Effects among Local Labour Markets in China By Gong, Xiaodong; Gao, Jiti; Liang, Xuan
  3. The impact of place-based policies on perceived regional living conditions across German labor market regions. Examining the impacts on migration flows. By Sven Wardenburg; Thomas Brenner
  4. OK Computer: The Creation and Integration of AI in Europe By Bernardo S. Buarque; Ronald B. Davies; Dieter F. Kogler; Ryan M. Hynes
  5. Understanding Migration Aversion using Elicited Counterfactual Choice Probabilities By Gizem Kosar; Tyler Ransom; Wilbert van der Klaauw
  6. Regional fiscal equalization. A simultaneous equation approach to assess the economic effects of fiscal policy By Jonathan Eberle
  7. Academic inventors: collaboration and proximity with industry By Crescenzi, Riccardo; Filippetti, Andrea; Iammarino, Simona
  8. The Role of Trust in Regional Development By Grillitsch, Markus; Nilsson, Magnus
  9. Industrial Land Policy and Economic Complexity of Chinese Cities By Zhaoyingzi Dong; Yingcheng Li; Pierre-Alexandre Balland; Siqi Zheng
  10. Firm soundness and knowledge externalities: a comparative regional analysis By Giuseppe Arcuri; Nadine Levratto; Aziza Garsaa; Lara Abdel Fattah
  11. Uneven economic development and its implications for policy: lessons from the UK By Overman, Henry G.
  12. Understanding the spatial disparities and vulnerability of population aging in China By Yang Cheng, Siyao Gao, Shuai Li, Yuchao Zhang and Mark Rosenberg
  13. Regional inequalities in African political economy: theory, conceptualization and measurement, and political effects By Boone, Catherine; Simson, Rebecca
  14. Industrial clusters in the long run: Evidence from Million-Rouble plants in China By Stephan Heblich; Marlon Seror; Hao Xu; Stephan Yanos Zylberberg
  15. Do firms exchange knowledge through complementary or substitutive routes of diffusion? By Amir Maghssudipour; Luciana Lazzeretti; Francesco Capone
  17. Classifying small (TL3) regions based on metropolitan population, low density and remoteness By Milenko Fadic; José Enrique Garcilazo; Ana Moreno Monroy; Paolo Veneri

  1. By: Stöver, Britta
    Abstract: Universities are important economic actors in having a considerable impact on the demand and supply side of their local economy. The aim of this paper is to quantify, compare and classify the different economic demand- and supply-side contributions of the university locations within Lower-Saxony using a combination of multiplier analysis and spatial econometrics on a NUTS-3 level. In comparison to numerous other studies this paper does not focus on the economic impact of single cases or a selected university location but gives a complete picture of the importance and significance of all university locations within Lower-Saxony. The income induced direct and indirect demand effects are estimated with a rich data set from higher education statistics in combination with an income and employment multiplier derived from a regional input-output table while the supply-side effects, i.e. the impact of the education and research outcomes, are calculated by estimating with spatial panel regressions a model derived from human capital theory and knowledge spillover theory. The estimation results give a complete and reproducible impression of the importance and significance of the different university locations offering the opportunity for comparisons and classifications.
    Keywords: Demand and supply-side effects; multiplier analysis; spatial panel model; university location
    JEL: I23 R11 R12 R15
    Date: 2019–06
  2. By: Gong, Xiaodong (NATSEM, University of Canberra); Gao, Jiti (Monash University); Liang, Xuan (Australian National University)
    Abstract: We examine how city size affect wage levels of cities (agglomeration externality) and how it influence surrounding cities (spill-over effect) in China for the period between 1995 and 2009. Using spatial fixed-effect panel data models and allowing for endogenous and exogenous spatial dependence, we find strong positive city size effect on real wage levels, which confirms the existence of agglomeration economy within cities. We also find significant differences in both the direct and indirect effect of factors such as FDI between more and less population dense areas.
    Keywords: agglomeration economy, spill-over, spatial econometrics, fixed-effects
    JEL: C23 R12 R23
    Date: 2019–05
  3. By: Sven Wardenburg (Department of Geography, Philipps University Marburg); Thomas Brenner (Department of Geography, Philipps University Marburg)
    Abstract: The paper analyzes the impact of the two major German regional development and redistribution policies, the municipal fiscal equalization scheme and the economic funds GRW, on perceived regional living conditions, measured through interregional migration between German labor market regions. Using a spatial vector-autoregressive panel model (SpVar), we find evidence that equalization transfers have a significant positive impact on perceived living conditions and contribute to the aim of regional equity. These effects are especially found for regions with low endogenous fiscal capacities. GRW funding reveals no significant effects on net migration rates in total, but short-term effects in rural regions.
    Keywords: amenities, fiscal equalization, impulse-response functions, living conditions, migration, policy, SpVar
    JEL: C33 R23 R58 O38
    Date: 2019–05
  4. By: Bernardo S. Buarque; Ronald B. Davies; Dieter F. Kogler; Ryan M. Hynes
    Abstract: This paper investigates the creation and integration of Artificial Intelligence (AI) patents in Europe. We create a panel of AI patents over time, mapping them into regions at the NUTS2 level. We then proceed by examining how AI is integrated into the knowledge space of each region. In particular, we find that those regions where AI is most embedded into the innovation landscape are also those where the number of AI patents is largest. This suggests that to increase AI innovation it may be necessary to integrate it with industrial development, a feature central to many recent AI-promoting policies.
    Keywords: Artificial Intelligence; Geography of Innovation; Knowledge Space; Technological Change; Regional Studies
    JEL: O33 O31 R11
    Date: 2019–05
  5. By: Gizem Kosar (Federal Reserve Bank of New York); Tyler Ransom (Oklahoma University); Wilbert van der Klaauw (Federal Reserve Bank of New York)
    Abstract: Residential mobility rates in the U.S. have fallen considerably over the past three decades. The cause of the long-term decline remains largely unexplained. In this paper we investigate the relative importance of alternative drivers of residential mobility, including job opportunities, neighborhood and housing amenities, social networks and housing and moving costs, using data from two waves of the NY Fed’s Survey of Consumer Expectations. Our hypothetical choice methodology elicits choice probabilities from which we recover the distribution of preferences for location and mobility attributes without concerns about omitted variables and selection biases that hamper analyses based on observed mobility choices alone. We estimate substantial heterogeneity in the willingness-to-pay (WTP) for location and housing amenities across different demographic groups, with income considerations, proximity to friends and family, neighbors’ shared norms and social values, and monetary and psychological costs of moving being key drivers of migration and residential location choices. The estimates point to potentially important amplifying roles played by family, friends, and shared norms and values in the decline of residential mobility rates.
    Keywords: migration, geographic labor mobility, neighborhood characteristics
    JEL: J61 R23 D84
    Date: 2019–06
  6. By: Jonathan Eberle (Department of Geography, Philipps University Marburg)
    Abstract: Regional fiscal equalization in Germany aims to reduce fiscal disparities by allocating financial resources to less promising regions in order to support the supply of public goods. This paper aims to analyse secondary economic effects of regional fiscal equalization on several economic in- and output variables. Additionally, the paper examines the potential regional characteristics to influence the transformation of fiscal inputs into economic outcomes. Lastly, I compare the effects of fiscal equalization to these of the major German structural funding program GRW. My findings reveal a significant positive effect of fiscal equalization on the regional employment rate. Moreover, the findings suggest different transmission channels of fiscal equalization in East and West Germany. Particularly, I find higher effects in right-wing CDU/CSU preferring regions on the employment, human capital and private-sector investment rate. Finally, while structural funding affects more economic variables significantly, the magnitude of the estimated economic responses of fiscal equalization compared to these of German structural funding are not statistically different.
    Keywords: fiscal equalization, regional economic growth, production function, political ideology, SpPVAR, impulse response function
    JEL: C33 E62 R11 R58 O38 O47
    Date: 2019–01
  7. By: Crescenzi, Riccardo; Filippetti, Andrea; Iammarino, Simona
    Abstract: This paper addresses a number of fundamental research questions on university-industry (U-I) collaborations. Are U-I collaborations intrinsically different from other forms of collaboration, such as inter-firm or inter-university collaborations? Are they more difficult to form? Is their output qualitatively different? What factors facilitate their development? By looking at the collaborative behavior of all Italian inventors over the 1978-2007 period, the empirical analysis shows that U-I collaborations are less likely to happen when compared to other types of collaboration, and suggests that they tend to generate patents of more general applicability in subsequent inventions. As emphasized by the literature, geographical proximity plays an important role in facilitating all forms of collaboration. At the same time, it works as a possible substitute for institutional proximity, facilitating U-I collaborations. However, the involvement of ‘star inventors’ on both sides of the collaboration can play an equally important role in ‘bridging’ universities and industry.
    Keywords: university-industry collaboration; institutional and geographical proximity; innovation; regions.; Intra-European Fellowship
    JEL: O31 O32 O33 R10
    Date: 2017–08–01
  8. By: Grillitsch, Markus (CIRCLE, Lund University); Nilsson, Magnus (CIRCLE, Lund University)
    Abstract: Regional development is a dynamic process where relatively stable periods are interrupted by phases of more rapid transformation and disruption. Such dynamics are heavily influenced by the scope and nature of knowledge networks. Trust is a key mechanism influencing the mobilization of networks for learning and innovation and thereby an important factor for understanding regional development. This paper sets out to unpack the role of trust in regional development by advancing a differentiated view that sheds light on why, when, and how trust affects regional development dynamics in a positive or negative way. Avenues for future research are identified.
    Keywords: Regional dynamics; trust; networks; path-dependency; path emergence; lock-in
    JEL: L14 L16 R11
    Date: 2019–05–24
  9. By: Zhaoyingzi Dong; Yingcheng Li; Pierre-Alexandre Balland; Siqi Zheng
    Abstract: Economies producing more complex products tend to be wealthier and grow more quickly. Therefore, a key issue for cities around the world is to develop new specializations into more complex industries. In China, local governments tend to use industrial land subsidy as a policy tool to attract new firms in desired industries and promote industrial growth. However, relatively little is known about the impact of this policy tool on the economic complexity of Chinese cities. Drawing upon the recent literature on the principle of relatedness and economic complexity, this paper investigates the impact of this industrial land policy (ILP) on the diversification of Chinese cities into more complex industries. The empirical results support our hypothesis that those cities providing higher intensity of land subsidy are more likely to enter new industries, in particular the most complex ones.
    Keywords: : Economic Complexity, Industry Complexity, Industrial Land Policy, Industrial Diversification
    JEL: O25 O38 R11
    Date: 2019–05
  10. By: Giuseppe Arcuri; Nadine Levratto; Aziza Garsaa; Lara Abdel Fattah
    Abstract: This paper investigates the role of regional context with regard to human capital and knowledge spillover effects in SMEs’ financial soundness. Our empirical setting is based on the multilevel analysis for panel data, which better allows for the treatment of hierarchical data. It is applied to firms belonging to the industrial sector and operating in four European countries over the 2010–2015 period. We find that a combination of individual- and regional-level characteristics explain firm soundness more accurately than individual features alone. Furthermore, we find that a higher local educational level and knowledge spillover improve the firm soundness.
    Keywords: Entreprise et territoire, capital humain, robustesse financière de l'entreprise, modèle multiniveau
    JEL: I25 L26 R11 C33
    Date: 2019
  11. By: Overman, Henry G.
    Abstract: This paper examines the UK’s large and, by some measures, growing variation in economic performance across cities and regions and assesses how policymakers can and should respond. The traditional policy mix – including central government investments in local growth projects, transport and other infrastructure, and funding for business support and access to finance – has not been effective. Greater local control is needed to improve policy effectiveness and recent devolution deals and directly elected mayors are a step in this direction. Nonetheless, when devolving powers, it is important that policies that have wide scale impacts (such as transport and housing) are coordinated across local areas. London’s strong economic performance plays a large part in explaining widening disparities within the UK. Providing an effective counter-balance to London may require policy aimed at ‘rebalancing’ to be more spatially focused. Ultimately, policymakers should care about the effect of policies on people more than on places and thus efforts to rebalance an economy should be judged on the extent to which they improve opportunities for all, rather than whether they narrow the gap between particular places.
    Keywords: economic development; United Kingdom
    JEL: R12 O15
    Date: 2018
  12. By: Yang Cheng, Siyao Gao, Shuai Li, Yuchao Zhang and Mark Rosenberg
    Abstract: Understanding the regional pattern of population aging in China enables rational policy making to address the challenges of inequity in social welfare and care resources among the east–central–west regions and rural–urban areas of China. This study uses census data in 2000 and 2010, and aging population ratios, annual increase rates, and spatial autocorrelation analysis to examine spatial disparities in population aging in China. The results show that the population is more aged and aging more rapidly in rural areas than in urban areas. Spatial clusters of population aging expanded from the east coastal region in 2000, to inland provinces such as Sichuan and Chongqing in 2010. The vulnerable regions in terms of population aging, health status of the elderly population, and economic level at the prefectural level were also identified.
    Keywords: China, population aging, rural and urban areas, spatial disparities, vulnerable regions
    Date: 2019–01–22
  13. By: Boone, Catherine; Simson, Rebecca
    Abstract: There is growing recognition in the economics literature that African countries are characterized by very large economic disparities across subnational regions. Yet the lack of systematic and reliable empirical data at subnational levels of aggregation has made it difficult to explore possible links between these spatial inequalities and political dynamics. This paper reviews some of the empirical literature that attempts to measure and compare spatial inequality within and acorss African countries, and asks whether and how it might be used to bring studies of Africa into dialogue with comparative political economy work on regional inequality in other parts of the world.
    Keywords: Africa; inequality; regionalism; political geography; urban-rural; political economy
    JEL: N0 Q15
    Date: 2019–03–11
  14. By: Stephan Heblich; Marlon Seror; Hao Xu; Stephan Yanos Zylberberg
    Abstract: This paper exploits a short-lived cooperation program between the U.S.S.R. and China, which led to the construction of 156 "Million-Rouble plants" in the 1950s. We isolate exogenous variation in location decisions due to the relative position of allied and enemy airbases and study the long-run impact of these factories on local economic activity. While the "156" program accelerated industrialization in treated counties until the end of the command-economy era, this significant productivity advantage fully eroded in the subsequent period. We explore the nature of local spillovers responsible for this pattern, and provide evidence that treated counties are overspecialized and far less innovative. There is a large concentration of establishments along the production chain of the Million-Rouble plants, which limits technological spillovers across industries.
    Keywords: USSR, China, million-rouble plants.
    Date: 2019–05–21
  15. By: Amir Maghssudipour (Dipartimento di Scienze per l'Economia e l'Impresa); Luciana Lazzeretti (Dipartimento di Scienze per l'Economia e l'Impresa); Francesco Capone (Dipartimento di Scienze per l'Economia e l'Impresa)
    Abstract: The aim of the present research is to investigate the rise and the evolution of research on the ‘creative economy’, which focuses on the convergence of four research pillars: contributions on the creative class, creative industries, creative city and cultural industries. Publications on Creative Economy Research have been collected from the ISI Web of Science database, which includes all the academic works starting from the contribution of DCMS in 1998 till 2013. Through the analysis of nearly 1.000 publications produced in 16 years, the birth and evolution of creative economy research is investigated. Besides, the second part of the paper focuses on a relational analysis developed through the use of Social Network Analysis, investigating co-citations of disseminators and founders of creative economy research. Results underline that the Creative economy may be considered a successful multidisciplinary paradigm born and developed in English speaking, North American and European countries, which has contributed to the rise of a new economic sector: the cultural and creative industries.
    Keywords: multiple networks; knowledge diffusion; ERGM; industrial cluster; wine industry.
    JEL: D85 L14 L84
    Date: 2019
  16. By: Christophe Providence (CREGED - Centre de Recherche en Gestion et Economie du Développement - Université Quisqueya, MEMIAD - Management, économie, modélisation, informatique et aide à la décision - UA - Université des Antilles)
    Abstract: For decade Haiti's development was thought to be the prerogative of the central authorities who conceived, in national logic, strategies for this purpose without necessarily considering the subnational specificities. This vision of the development of the territories emerged from a unique context and history that would therefore imply a unique development logic. By taking the case of studies the budgetary allocations to the Haitian communes for the fiscal years2017-2018, we want to demonstrate that the logic of allocating the financing of local authorities is neither neutral nor strategic. The purpose of this article is twofold. First, it is to model spatial disparities and structural instability in the national territory. Secondly, it is to study the differences in space and to explain the inclusiveness and complementary nature of the territorial development process. Limited analysis of the communal allocations of budgetary appropriations reveals two major anomalies in the financing logic of these territories. The first anomaly considers the legitimization of territorial and socioeconomic disparities that comes from an unenlightened choice of leaders to design Haitian territory and the proximity relations between the localized actors. The second anomaly is found in the lack of vision or global consideration in the national strategy for territorial development. The Haitian State cannot therefore make a planned and strategic management of the territory because it is too dependent on the economic events.
    Keywords: Territorial Development,Spatial Disparities,Proximities,Local Financing,Territorial Nesting
    Date: 2019–05–20
  17. By: Milenko Fadic; José Enrique Garcilazo; Ana Moreno Monroy; Paolo Veneri
    Abstract: This paper provides a method to classify TL3regions across OECD countries based on their level of access to metropolitan areas. TL3 regions are classified as ‘metropolitan’ if more than half of their population lives in one or more functional urban area (FUA) of at least 250 thousand inhabitants and as ‘non-metropolitan’ otherwise. The method sub-classifies metropolitan regions into ‘large metro’ or ‘metro’ regions based on the population size of the FUAs located within those regions. Non-metropolitan TL3 regions are sub-classified into: with accessto a metro, with access to a small/medium city, or remote based on their level of access to a FUA with population above a predetermined threshold. The method relies on publicly available grid-level population data and localised information on driving conditions.
    Keywords: culture, Indigenous peoples, place, regional and rural development, sustainable development goals, well-being
    JEL: C80 R41 R52 R58
    Date: 2019–06–06

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