nep-geo New Economics Papers
on Economic Geography
Issue of 2019‒11‒18
four papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. The fetters of inheritance? Equal partition and regional economic development By Huning, Thilo R.; Wahl, Fabian
  2. Do EU regions benefit from smart specialization? By David L. Rigby; Christoph Roesler; Dieter Kogler; Ron Boschma; Pierre-Alexandre Balland
  3. Delineating urban areas using building density By Marie-Pierre de Bellefon; Pierre-Philippe Combes; Gilles Duranton; Laurent Gobillon; Clément Gorin
  4. Valuing cultural diversity of cities By David C. Maré; Jacques Poot

  1. By: Huning, Thilo R.; Wahl, Fabian
    Abstract: How can agricultural inheritance traditions affect structural change and economic development in rural areas? The most prominent historical traditions are primogeniture, where the oldest son inherits the whole farm, and equal partition, where land is split and each heir inherits an equal share. In this paper, we provide a theoretical model that links these inheritance traditions to the local allocation of labor and capital and to municipal development. First, we show that among contemporary municipalities in West Germany, equal partition is significantly related to measures of economic development. Second, we conduct OLS and fuzzy spatial RDD estimates for Baden-Württemberg in the 1950s and today. We find that inheritance rules caused, in line with our theoretical predictions, higher incomes, population densities, and industrialization levels in areas with equal partition. Results suggest that more than a third of the overall inter-regional difference in average per capita income in present-day Baden Württemberg, or 597 Euro, can be explained by equal partition.
    Keywords: inheritance rules,sectoral change,regional economic development,Baden-Württemberg,spatial inequalities
    JEL: D02 D82 H11 H21 N93
    Date: 2019
  2. By: David L. Rigby; Christoph Roesler; Dieter Kogler; Ron Boschma; Pierre-Alexandre Balland
    Abstract: Smart specialization was conceived as a “bottom-up†framework to identify new growth paths connected to the existing knowledge cores of regions. Operationalization of smart specialization has proven difficult, though a recent “mapping†of technologies in terms of knowledge relatedness and complexity suggests a useful cost-benefit framework. We extend these ideas, locating EU cities in a smart specialization space and tracking their development of alternative technologies over the period 1981 to 2015. Panel models show employment growth and GDP growth are faster in cities that exhibit a logic of technological development consistent with the tenets of smart specialization.
    Keywords: smart specialization, policy, complexity, technological relatedness, European Union
    JEL: O25 O38 R11
    Date: 2019–11
  3. By: Marie-Pierre de Bellefon (Insee and Paris School of Economics, 48 Boulevard Jourdan, 75014 Paris, France); Pierre-Philippe Combes (Univ Lyon, CNRS, GATE UMR 5824, 93 Chemin des Mouilles, 69131 Ecully, France and Sciences Po, Economics Department, 28, Rue des Saints-Pères, 75007 Paris, France; Also affiliated with the Centre for Economic Policy Research and the Institute for the Study of Labor (IZA)); Gilles Duranton (Wharton School, University of Pennsylvania, 3620 Locust Walk, Philadelphia, pa 19104, USA; Also affiliated with the National Bureau of Economic Research and the Center for Economic Policy Research); Laurent Gobillon (PSE-CNRS, 48 Boulevard Jourdan, 75014 Paris, France; Also affiliated with the Centre for Economic Policy Research and the Institute for the Study of Labor (IZA)); Clément Gorin (Univ Lyon, CNRS, GATE UMR 5824, 93 Chemin des Mouilles, 69131 Ecully, France)
    Abstract: We develop a new dartboard methodology to delineate urban areas using detailed information about building location, which we implement using a map of all buildings in France. For each pixel, our approach compares actual building density after smoothing to counterfactual smoothed building density computed after randomly redistributing buildings. We define as urban any area with statistically significant excess building density. Within urban areas, extensions to our approach allow us to distinguish ‘core’ urban pixels and detect centres and subcentres. Finally, we develop novel one- and two-sided tests that provide a statistical basis to compare maps with different delineations, which we use to assess the robustness of our approach and to document large differences between our preferred delineation and the corresponding official one.
    Keywords: urban area definition, dartboard approach, Jaccard indices
    JEL: C14 R12 R14
    Date: 2019
  4. By: David C. Maré (Motu Economic and Public Policy Research); Jacques Poot (Vrije Universiteit)
    Abstract: This paper revisits whether cultural diversity is a source of local production and/or consumption amenities. We adapt the analytical framework of Roback (1982, 1988) and Chen & Rosenthal (2008) to estimate the impact of cultural diversity on city wage and rent premiums from hedonic regressions. We focus on New Zealand which – with high residential mobility and ease of setting up business – is particularly suited to this framework. Additionally, our estimates are based on a very large data set: complete unit record census data on individuals and dwellings in 110 urban areas spanning 32 years. Controlling for observed and unobserved city characteristics, and for the potential endogeneity of diversity, we find that cultural diversity serves as a local positive production amenity and a weakly negative consumption amenity. The results are mostly robust to measuring cultural diversity by birthplace, ethnicity or religion; and to using a range of measures of diversity. We conclude that the presence of people from different cultural backgrounds enhances the profitability of urban firms. In contrast, a city’s population has a weak preference for living near others who are culturally similar to them. The effects are stronger in larger cities.
    Keywords: Diversity; fractionalisation; local amenity; urban wages and rents; hedonic regression
    JEL: J31 R21 R23 R31
    Date: 2019–10

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