nep-geo New Economics Papers
on Economic Geography
Issue of 2021‒01‒11
six papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. Cities in a world of diminishing transport costs By Tomoya Mori; Minoru Osawa
  2. Economic corridors in Southeast Asia: Analytical framework, development Impacts, and policy By Hal Hill; Jayant Menon
  3. Place-based SME finance policy and local industrial revivals: An empirical analysis of a directed credit program after WW2 By Takano, Keisuke; Okamuro, Hiroyuki
  4. Optimal Road Network and the Gains from Intranational Trade By Dias, Lucas; Haddad, Eduardo; Maggi, Andrés
  5. LOCATION DETERMINANTS OF ECOINNOVATIVE FIRMS IN FRANCE By Eva Coll-Martinez; Malia Kedjar; Patricia Renou-Maissant
  6. Regional developmentalism in West Africa: The case for commodity-based industrialisation through regional cooperation in the cocoa-chocolate sector By Jonathan Bashi Rudahindwa; Sophie van Huellen

  1. By: Tomoya Mori; Minoru Osawa
    Abstract: Economic activities favor mutual geographical proximity and concentrate spatially to form cities. In a world of diminishing transport costs, however, the advantage of physical proximity is fading, and the role of cities in the economy may be declining. To provide insights into the long-run evolution of cities, we analyzed Japan's census data over the 1970--2015 period. We found that fewer and larger cities thrived at the national scale, suggesting an eventual mono-centric economy with a single megacity; simultaneously, each larger city flattened out at the local scale, suggesting an eventual extinction of cities. We interpret this multi-scale phenomenon as an instance of pattern formation by self-organization, which is widely studied in mathematics and biology. However, cities' dynamics are distinct from mathematical or biological mechanisms because they are governed by economic interactions mediated by transport costs between locations. Our results call for the synthesis of knowledge in mathematics, biology, and economics to open the door for a general pattern formation theory that is applicable to socioeconomic phenomena.
    Date: 2020–12
  2. By: Hal Hill; Jayant Menon
    Abstract: Economic corridors have gained popularity as a potentially important instrument in the development and transformation of low and middle income economies. But why have some countries had more success with them than others? What role does governance, institutions, finance and policy frameworks play in determining their success? How can we measure their impacts? We try and answer these questions by looking closely at, and drawing lessons from, two case studies of successful corridors in Asia, Malaysia and Thailand. A key conclusion is that economic corridors are more likely to succeed with greater domestic spillovers when the physical and policy infrastructure are conducive.
    Keywords: Economic corridors, economic geography, Southeast Asia
    JEL: O53 R11 R58
    Date: 2020
  3. By: Takano, Keisuke; Okamuro, Hiroyuki
    Abstract: This paper examined the effects on the performance of local SMEs of a modernization fund program for small business enterprises implemented by Osaka Prefecture in the early 1950s. Utilizing firm-level panel data based on business credit reports, we empirically evaluated the effects of the program. We found an improvement in production levels among the recipients. In addition, recipients in sectors related to munitions production or in industrial agglomerations specialized in these sectors achieved additional or larger improvements in their production levels.
    Keywords: place-based policy, postwar revival, directed credit, modernization, Osaka
    JEL: H84 N95 O12 R51 R58
    Date: 2020–10
  4. By: Dias, Lucas (Departamento de Economia, Universidade de São Paulo); Haddad, Eduardo (Departamento de Economia, Universidade de São Paulo); Maggi, Andrés (Harvard University)
    Abstract: This paper assesses the efficiency of the Brazilian road network using data on road speeds and distances and a spatial general equilibrium model with costly trade. We find that Brazil would gain 0.31% of welfare if better organize its road network for intranational trade and that the most populated regions are relatively oversupplied of transport infrastructure compared with the remote and poor areas. We further find long lasting effects of the highways’ project designed to integrate Brasília with the rest of the country in the 1960s. Regions connected by the so-called Radial Highways are currently oversupplied of transport infrastructure.
    Keywords: Optimal Road Network; Intranational Trade
    JEL: F10 O18 R40
    Date: 2021–01–06
  5. By: Eva Coll-Martinez (Sciences Po, Toulose); Malia Kedjar (Normandie University); Patricia Renou-Maissant (EconomiX, CNRS, University of Paris Nanterre))
    Abstract: This paper analyses the location determinants of eco-innovative firms in France. The analysis is based on a dataset obtained after merging firm-level microdata on the location of new firms from DIANE Mercantil Register (Bureau van Dijk) and patents information from the OECD REGPAT (2018) database for the period 2003 and 2013. This paper departs from previous contributions on the location determinants of eco-innovation in three main ways. First, it analyses the effects of the regional technological knowledge base and its composition focusing on environmental-based innovations. Second, it introduces spatial econometrics techniques to capture any potential spatial spillovers arising from the location of eco-innovative firms. And third, it focuses on the French case which is of special interest in view of the relevance of regional eco-innovation policies. Main results show that unrelated knowledge variety for environmental technologies and the political support in terms of investments for the protection of the environment are the main factors explaining the location of eco-innovative firms. Indeed, by applying spatial econometrics we found that there is a clear spatial dependence on the creation. However, our results also show that the impact of the knowledge composition is quite local. These results may have many implications for French departments’ environmental performance and sustainable growth.
    Keywords: eco-innovative firms’ entry, industrial location, knowledge spillovers, environmental technologies, France
    JEL: L
    Date: 2020
  6. By: Jonathan Bashi Rudahindwa (Université Protestante au Congo, Kinshasa, Democratic Republic of Congo; School of Law, SOAS University of London); Sophie van Huellen (Department of Economics, SOAS University of London)
    Abstract: Regional integration occupies a prominent place in the economic policies of most Sub-Saharan African countries. However, despite different waves of initiatives across the African continent, the majority of African regional schemes have not managed to achieve their ambitious goal of promoting sustainable development through trade integration in Africa. In light of this observation, using the West African cocoa-chocolate sector as a case study, we propose the regional developmentalism paradigm as an alternative approach to regionalism in Africa, placing a particular emphasis on the use of regional and sub-regional approaches to development. Instead of full-fledged trade liberalisation and indiscriminate economic integration, the regional developmentalism paradigm advocates for state-led trade facilitation, regulatory convergence and capacity-building through the adoption of policies directed at strategic sectors. We evaluate the potential of the regional developmentalism paradigm to promote economic ttransformation and commodity-based industrialisation against the shortcomings of the current regional integration approach embodied in the institutional framework of ECOWAS.
    Keywords: West Africa; regional integration; development; developmental state; industrialisation; cocoa; ECOWAS
    JEL: F02 F13 K33 O13 O24
    Date: 2020–12

This nep-geo issue is ©2021 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.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.