nep-geo New Economics Papers
on Economic Geography
Issue of 2020‒07‒20
twelve papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. Regional patterns of unrelated technological diversification: the role of academic inventors By Francesco Quatraro; Alessandra Scandura
  2. Firm Agglomeration in Knowledge Intensive Business Service Sectors By Shinya Fukui
  3. Cities, Lights, and Skills in Developing Economies By Davis, Donald R; Dingel, Jonathan; Miscio, Antonio
  4. Regional labour market structures By Sijmons, David; Bakens, Jessie
  5. Does university performance have an economic payoff for their home regions? Evidence for the Spanish provinces By Joan Crespo; Jesús Peiró-Palomino; Emili Tortosa-Ausina
  6. The persistence of apartheid regional wage disparities in South Africa By Gibson Mudiriza; Lawrence Edwards
  7. Measuring commute patterns over time: Using administrative data to identify where employees live and work By Richard Fabling; David C. Maré
  8. Connective Financing - Chinese Infrastructure Projects and the Diffusion of Economic Activity in Developing Countries By Richard Bluhm; Axel Dreher; Andreas Fuchs; Bradley C. Parks; Austin M. Strange; Michael J. Tierney
  9. What do divided cities have in common? An international comparison of income segregation By Paolo Veneri; Andre Comandon; Miquel-Àngel Garcia-López; Michiel N. Daams
  10. Workplace Choice, Commuting Costs, and Wage Taxation in Urban and Adjacent Rural Regions By Batabyal, Amitrajeet; Nijkamp, Peter
  11. Learning opportunities stemming from place-based transformative Smart Specialisation. Examples from Visegrad Group countries. By Katerina Ciampi Stancova
  12. Unified Principal Component Analysis for Sparse and Dense Functional Data under Spatial Dependency By Haozhe Zhang; Yehua Li

  1. By: Francesco Quatraro; Alessandra Scandura
    Abstract: This paper investigates the relationship between the involvement of academic inventors in local innovation dynamics and the patterns of regional technological diversification. Based on the combination of the evolutionary economic approach and the theories on regional innovation capabilities, and on the distinctive features of academic inventors, we hypothesise that knowledge spillovers accruing from the participation of university scientists to local patenting activity influence the extent of regional technological diversification. In addition, we posit that the involvement of academic inventors mitigates the path dependency engendered by the constraining role of the existing capabilities. The empirical results highlight the key role of academic institutions for the development of regional technological trajectories while contributing to the academic and policy debate on regional diversification strategies.
    Keywords: regional diversification, relatedness, academic inventors
    JEL: O33 R11
    Date: 2020
  2. By: Shinya Fukui (Graduate School of Economics, Kobe University / Senior Researcher, Osaka Prefectural Government, Japan)
    Abstract: We observe dense agglomerations of Knowledge-Intensive Business Services (KIBS) in large cities such as Tokyo and Osaka. Such urban features of KIBS stem from the fact that the main customers for KIBS are corporate headquarters (HQs), and KIBS’s main input is highly skilled labor. We adhere to the model proposed by Redding and Venables (2004) and present a monopolistic competition model. Our results indicate that improving access to the agglomeration of HQs and KIBS and knowledge agglomeration will strengthen market access and supply access and that KIBS firms will be even more inclined to establish locations in those municipalities.
    Date: 2020–06
  3. By: Davis, Donald R; Dingel, Jonathan; Miscio, Antonio
    Abstract: In developed economies, agglomeration is skill-biased: larger cities are skill-abundant and exhibit higher skilled wage premia. This paper characterizes the spatial distributions of skills in Brazil, China, and India. To facilitate comparisons with developed-economy findings, we construct metropolitan areas for each of these economies by aggregating finer geographic units on the basis of contiguous areas of light in nighttime satellite images. Our results validate this procedure. These lights-based metropolitan areas mirror commuting-based definitions in the United States and Brazil. In China and India, which lack commuting-based definitions, lights-based metropolitan populations follow a power law, while administrative units do not. Examining variation in relative quantities and prices of skill across these metropolitan areas, we conclude that agglomeration is also skill-biased in Brazil, China, and India.
    Keywords: cities; Metropolitan areas; satellite images; skill-biased agglomeration; Zipf's law
    JEL: C8 O1 O18 R1
    Date: 2020–02
  4. By: Sijmons, David; Bakens, Jessie (RS: GSBE other - not theme-related research, ROA / Dynamics of the labour market)
    Abstract: Heterogeneity in economic structures between different countries or regions has been examined by economists for a long time. Much of the literature has focused on explaining (and quantifying) interregional differences in production and income. However, little attention is focused on explaining and quantifying differences in occupational and educational compositions of the workforce across regions. This is the gap this paper tries to fill by analyzing regional occupational and educational structures in the Netherlands.
    Date: 2020–07–14
  5. By: Joan Crespo (Department of Economics, Universitat Jaume I, Castellón, Spain); Jesús Peiró-Palomino (INTECO & Department of Applied Economics II, University of Valencia, Spain); Emili Tortosa-Ausina (IVIE, Valencia and Department of Economics, Universitat Jaume I, Castellón, Spain)
    Abstract: This paper analyzes the impact of the university system performance on labor productivity growth for Spanish regions during the period 2009–2016. Using a frontier approach, we decompose changes in university performance into efficiency changes (approximations to the frontier) and changes due to technical progress (shifts of the frontier). Our results show a positive link between university performance and the productivity growth of their home regions. We also find that this impact is driven by shifts in the frontier rather than by approximation to the frontier. This effect is robust across stages of the economic cycle (crisis and recovery), as well as across different estimation methods, and when including spatial spillovers, although it is only significant for provinces with productivity levels above the median. This suggests that the inefficiency of the Spanish university system can be one of the factors slowing down the convergence path of Spanish provinces.
    Keywords: university performance, productivity, provinces
    JEL: C61 J24 R11
    Date: 2020
  6. By: Gibson Mudiriza; Lawrence Edwards
    Abstract: Despite the ending of apartheid, regional wage disparities remain prevalent in South Africa with the former homelands characterised by persistently low wages and incomes. In this paper, we use a new economic geography (NEG) model to estimate the extent to which the persistence in apartheid regional wage disparities are an outcome of economic forces such as access to markets. We estimate a structural wage equation derived directly from the NEG theory for 354 regions over the period 1996 to 2011. We find support for the NEG model in explaining regional wage disparities across regions in South Africa, although the market access effects are highly localised in view of high distance coefficients. We also find a wage deficit in homeland areas even after controlling for NEG and other region-specific characteristics. Average wages of workers in homeland areas were 11.8% lower than predicted in 1996, with this gap rising to 13.3% in 2011. This gap remains using alternative estimation approaches and the inclusion of controls for infrastructure, removal of incentives under the deconcentration policies and local amenities.
    Keywords: : Economic geography; Labour market, Wage differentials, Regional economic activity, Economic Development
    JEL: F12 F16 J31 R11
    Date: 2020–04
  7. By: Richard Fabling (Independent Researcher); David C. Maré (Motu Economic and Public Policy Research)
    Abstract: We use administrative and survey data in the Integrated Data Infrastructure (IDI) to allocate workers to job locations (plants), which enables the production of over a decade of commute distance population statistics for New Zealand employees. We find that average commute distance (meshblock centroid-to-centroid) fell from 2005 to 2009 before rising again through to 2018 (the final analysis year), with most regions displaying this general temporal pattern. Census 2013 place of residence and work is used to test our methodology against the alternative of using pre-existing plant allocations from the Linked Employer-Employee Data (LEED) production system. For a consistent set of individuals, our estimate of the commute distance distribution closely matches the corresponding distribution in Census. In contrast, LEED-based estimates tend to significantly overestimate commute distances, including radically overestimating the likelihood of inter-island commuting. Our more plausible results are primarily due to re-engineering the job allocation process, as opposed to exploiting better administrative data, though we make marginal improvements to residential address identification through a new prioritisation method, allowing us to use a broader set of residential address sources than available in LEED.
    Keywords: commuting patterns; linked employer-employee data (LEED); Integrated Data Infrastructure (IDI); administrative data
    JEL: R40 R41 M21
    Date: 2020–07
  8. By: Richard Bluhm; Axel Dreher; Andreas Fuchs; Bradley C. Parks; Austin M. Strange; Michael J. Tierney
    Abstract: This paper studies the causal effect of transport infrastructure on the spatial concentration of economic activity. Leveraging a new global dataset of geo-located Chinese government-financed projects over the period from 2000 to 2014 together with measures of spatial inequality based on remotely-sensed data, we analyse the effects of transport projects on the spatial distribution of economic activity within and between regions in a large number of developing countries. We find that Chinese-financed transportation projects reduce spatial concentration within but not between regions. In line with land use theory, we document a range of results which are consistent with a relocation of activity from city centers to their immediate periphery. Transport projects decentralize activity particularly strongly in regions that are more urbanized, located closer to the coast, and less developed. .
    Keywords: transport costs, infrastructure, development finance, foreign aid, spatial concentration China
    JEL: F15 F35 R11 R12 P33 O18 O19
    Date: 2020
  9. By: Paolo Veneri (OECD Centre for Entrepreneurship, Paris, France); Andre Comandon (University of California, Los Angeles (UCLA), United States); Miquel-Àngel Garcia-López (Universitat Autònoma de Barcelona, Institut d’Economia de Barcelona, Spain); Michiel N. Daams (University of Groningen, Department of Economic Geography, Groningen, Netherlands)
    Abstract: This paper provides a comparative assessment of income segregation within cities in 12 countries. We use spatial entropy indexes based on small-scale gridded income data and consistent definition of city boundaries to ensure international comparability of our segregation measures. Results show considerable variation in the levels of income segregation across cities, even within countries, reflecting the diversity of cities within urban systems. Larger, more affluent, productive, and more unequal cities tend to be more segregated. Urban form, demographic, and economic factors explain additional variation in segregation levels through the influence of high-income households, who tend to be the most segregated. The positive association between productivity and segregation is mitigated in polycentric cities.
    Keywords: segregation, income, functional urban areas, international urban comparison, spatial inequalities
    JEL: D63 R12
    Date: 2020–07
  10. By: Batabyal, Amitrajeet; Nijkamp, Peter
    Abstract: We analyze the impact of wage taxation on the workplace choices of and the commuting costs borne by individuals in an aggregate economy consisting of an urban and an adjacent rural region. This economy is inhabited by a continuum of individuals who are uniformly distributed with a total mass of one. These individuals choose whether to work in the urban or in the rural region. The wage is higher (lower) in the urban (rural) region. Our analysis leads to three findings. First, assuming that individuals work in the region in which their after-tax wage net of commuting costs is the highest, we compute the equilibrium number of workers in each region. Second, supposing that the rural region’s median voter works in the urban region, we determine the Nash equilibrium in taxes and ask whether either of the two regions ought to tax or to subsidize the wage. Finally, assuming that the rural region’s median voter works in the rural region, we solve for the Nash equilibrium in taxes and show that optimality calls for the urban and the rural governments to subsidize the two wages.
    Keywords: Commuting Cost, Rural Region, Urban Region, Wage Taxation, Workplace Choice
    JEL: H30 R12 R49
    Date: 2019–09–06
  11. By: Katerina Ciampi Stancova (European Commission - JRC)
    Abstract: Smart specialisation (S3) is a place-based agenda for regional economic transformation. To that end, smart specialisation emphasises the importance of strategic thinking, good (multi-level) governance, existence of public institutions that are able to orchestrate fruitful discussion about the region’s future development trajectories as well as develop appropriate policy instruments and interventions, and finally engaged stakeholders that are willing to take an active lead in local development. In order to achieve these objectives, public institutions are required to learn constantly – explore, integrate and exploit knowledge acquired by individuals. The proposition of this study is to discuss if and how smart specialisation fosters policy learning and to provide some evidence on implementation of smart specialisation and associated policy learning opportunities in Visegrad Group countries.
    Keywords: smart specialisation, policy learning, knowledge networks, innovation policy, Visegrad Group countries
    Date: 2020–05
  12. By: Haozhe Zhang; Yehua Li
    Abstract: We consider spatially dependent functional data collected under a geostatistics setting, where spatial locations are irregular and random. The functional response is the sum of a spatially dependent functional effect and a spatially independent functional nugget effect. Observations on each function are made on discrete time points and contaminated with measurement errors. Under the assumption of spatial stationarity and isotropy, we propose a tensor product spline estimator for the spatio-temporal covariance function. When a coregionalization covariance structure is further assumed, we propose a new functional principal component analysis method that borrows information from neighboring functions. The proposed method also generates nonparametric estimators for the spatial covariance functions, which can be used for functional kriging. Under a unified framework for sparse and dense functional data, infill and increasing domain asymptotic paradigms, we develop the asymptotic convergence rates for the proposed estimators. Advantages of the proposed approach are demonstrated through simulation studies and two real data applications representing sparse and dense functional data, respectively.
    Date: 2020–06

This nep-geo issue is ©2020 by Andreas Koch. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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