nep-geo New Economics Papers
on Economic Geography
Issue of 2021‒10‒04
nine papers chosen by
Andreas Koch
Institut für Angewandte Wirtschaftsforschung

  1. Combining knowledge bases for system innovation in regions: Insights from an East German case study By Friedrich, Christoph; Feser, Daniel
  2. Behind the Italian Regional Divide: An Economic Fitness and Complexity Perspective By Angelica Sbardella; Andrea Zaccaria; Luciano Pietronero; Pasquale Scaramozzino
  3. A dynamic theory of spatial externalities By Boucekkine, R.; Fabbri, G.; Federico, S.; Gozzi, F.
  4. The role of powerful incumbent firms: shaping regional industrial path development through change and maintenance agency By Simon Baumgartinger-Seiringer
  5. Regional technological capabilities and Green opportunities in Europe By Nicolo Barbieri; Davide Consoli; Lorenzo Napolitano; Francois Perruchas; Emanuele Pugliese; Angelica Sbardella
  6. The Causal Effect of Transport Infrastructure: Evidence from a New Historical Database By Lindgren, Erik; Pettersson-Lidbom, Per; Tyrefors, Björn
  7. Comparing Institutional Textures between Germany and Italy with LAU level data By Nadia von Jacobi
  8. The geography of banks in the United States (1990-2020) By Angeloni, Ignazio; Kasinger, Johannes; Chantawit Tantasith
  9. Labour conditions in regional versus global value chains: Insights from apparel firms in Lesotho and Eswatini By Giovanni Pasquali

  1. By: Friedrich, Christoph; Feser, Daniel
    Abstract: A growing number of economic geography scholars have discussed the spatial dimensions of sustainability innovation in socio-technical systems to overcome societal, economic, and ecological problems. This research usually focuses on businesses in the knowledge economy and success factors. However, sustainability innovation involves the collaboration of upstreaming process stages and open innovation processes with a broad range of different actors. Innovation intermediaries, such as universities and research institutes, are needed to support and accelerate the transfer of knowledge. Nevertheless, little is known about the influence of the cognitive and institutional diversity of actors on the configuration of knowledge bases required for sustainability innovation. This article presents insights from 16 semi-structured expert interviews conducted in a regional innovation system (RIS) in East Germany. We investigate four innovation intermediaries in the region of Eberswalde in cooperation with the Eberswalde University for Sustainable Development. The analytical framework links the concept of differentiated knowledge bases to sustainability transitions and sustainability-oriented knowledge transfer. Our results show that, first, in the Eberswalde region, the relevant actors involved in regional knowledge transfer predominantly focus on synthetic knowledge bases, such as experience-based knowledge of local area settings. Second, symbolic knowledge bases are crucial and often prerequisites for intermediary organizations to recombine knowledge bases and support the capability to innovate in regional knowledge transfer. Symbolic knowledge contains, in particular, the ability to translate scientific findings to a language that can be understood by the various actors in knowledge transfer. Third, organizational innovation complements social innovation to support innovation on a systemic level and foster change processes.
    Keywords: Knowledge bases,system innovation,knowledge transfer,innovation intermediation,sustainability transition
    JEL: D02 D80 O12 P48 Q56 R11
    Date: 2021
  2. By: Angelica Sbardella; Andrea Zaccaria; Luciano Pietronero; Pasquale Scaramozzino
    Abstract: This paper applies the Economic Fitness and Complexity approach to analyse the underlying factors behind the wide and persistent economic disparities across the Italian regional units. Measures of regional fitness are obtained from their revealed comparative advantage and from their patent performance. Southern regions tend to be characterised by a lower level of complexity than the regions in the Centre-North of the country. We interpret these results as indicating a lower level of capability endowment in the South. The system-wide approach of the paper is able to identify some critical sectors which display a rich pattern of connections with other sectors and which could play a pivotal role to create additional capabilities and foster a more balanced regional development.
    Keywords: Italian regional divide; Economic Fitness and Complexity; Productive and technological capabilities.
    Date: 2021–09–22
  3. By: Boucekkine, R.; Fabbri, G.; Federico, S.; Gozzi, F.
    Abstract: This work targets the class of spatiotemporal problems with free riding under natural (pollution, epidemics...etc) diffusion and spatial externalities. Such a class brings to study a family of differential games in continuous time and space. In the fundamental pollution free riding problem we develop a strategy to solve completely the associated game contributing to the associated debate on environmental federalism. We depart from the preexisting literature in several respects. First, instead of assuming ad hoc pollution diffusion schemes across space, we consider a realistic spatiotemporal law of motion for pollution (diffusion and advection). Second, we tackle spatiotemporal non-cooperative (and cooperative) differential games instead of static games in the related literature. Precisely, we consider a circle partitioned into several states where a local authority decides autonomously about its investment, production and depollution strategies over time knowing that investment/production generates pollution, and pollution is transboundary. The time horizon is innite. Third, we allow for a rich set of geographic heterogeneities across states while the literature assumes identical states. We solve analytically the induced non-cooperative differential game under decentralization and fully characterize the resulting long-term spatial distributions. In particular, we prove that there exist a Perfect Markov Equilibrium, unique among the class of the affine feedbacks. We further provide with full exploration of the free riding problem, reected in the so-called border effects. Finally, we explore how geographic discrepancies (the most elementary being the asymmetry of players) affect the shape of the border effects. We check in particular that our model is consistent with the set of stylized facts put forward by the related empirical literature.
    JEL: Q53 R12 O13 C72 C61 O44
    Date: 2021
  4. By: Simon Baumgartinger-Seiringer
    Abstract: This article seeks to advance perspectives on powerful incumbent firms in (new) regional industrial path development. Drawing on recent insights from Transition Studies, it is argued that this – hitherto often neglected – actor group plays a crucial role in shaping the pace and direction of regional path development through agency oriented towards both change and maintenance. Building on systemic perspectives at the intersection of evolutionary economic geography and innovation studies, particular emphasis is placed on incumbent firms’ interventions to reconfigure or stabilize their surrounding regional innovation system to support their intentions. To this end, this article examines how incumbents exert their influence through various forms of power as means by which they promote or hinder regional industrial change. Empirically, the role of incumbent firms in a traditional automotive industry in Austria is investigated. It is shown how they leverage their power to propel the industry’s digitalization and suppress its decarbonization.
    Keywords: regional restructuring, path development, incumbents, agency, automotive industry, power
    JEL: O33 R11 R58
    Date: 2021
  5. By: Nicolo Barbieri; Davide Consoli; Lorenzo Napolitano; Francois Perruchas; Emanuele Pugliese; Angelica Sbardella
    Abstract: The goal of the paper is to elaborate an empirical overview of green technological development in European regions. This is a timely pursuit considering the ambitious commitments stipulated in the recent European Green Deal to achieve climate neutrality by 2050. Our analysis is organised in three steps. First, we map the geographical distribution of innovative activities in Europe and profile regions in terms of technological capabilities. Second, we elaborate a metric to identify regions' green innovation potential. Third, we check whether possessing comparative advantage in specific technological domains is associated with a region's capacity to develop green technologies.
    Keywords: Green Technology; European regions; Economic Fitness and Complexity.
    Date: 2021–09–22
  6. By: Lindgren, Erik (Department of Economics, Stockholm University); Pettersson-Lidbom, Per (Department of Economics, Stockholm University); Tyrefors, Björn (Research Institute of Industrial Economics (IFN))
    Abstract: In this paper, we analyze the effect of transport infrastructure investments in railways. As a testing ground, we use data from a new historical database that includes annual panel data on approximately 2,400 Swedish rural geographical areas during the period 1860-1917. We use a staggered event study design that is robust to treatment effect heterogeneity. Importantly, we find extremely large reduced-form effects of having access to railways. For real nonagricultural income, the cumulative treatment effect is approximately 130% after 30 years. Equally important, we also show that our reduced-form effect is likely to reflect growth rather than a reorganization of existing economic activity since we find no spillover effects between treated and untreated regions. Specifically, our results are consistent with the big push hypothesis, which argues that simultaneous /coordinated investment, such as large infrastructure investment in railways, can generate economic growth if there are strong aggregate demand externalities (e.g., Murphy et al. 1989). We used plant-level data to further corroborate this mechanism. Indeed, we find that investments in local railways dramatically, and independent of initial conditions, increase local industrial production and employment on the order of 100‒300% across almost all industrial sectors.
    Keywords: Railways; Transport infrastructure; Real income; Event study; Treatment heterogeneity
    JEL: H54 L92 N73 O22 R12 R42
    Date: 2021–09–22
  7. By: Nadia von Jacobi
    Abstract: In view of comparing the institutional textures of Germany and Italy (Boltho et al., 2017), I go beyond existing comparable datasets at NUTS2 and NUTS3 level and construct two datasets at the LAU level, which for Germany captures the "Gemeinde" and for Italy the "Municipio". In this paper I briefly present the variables that were identified as comparable across the two countries. The resulting LAUDEIT dataset has been prepared for future empirical investigations of the particularities of institutional architecture (Gertler, 2010) that may contribute to different socio-economic performance within common European governance (Boitani and Tamborini, 2021; Johnston and Reagan, 2017). Descriptive statistics of the dataset hint there may be structural differences between the two countries in terms of commuting and internal migration patterns, size of the firm and - in a related fashion - entrepreneurship rate. Municipal data also confirm that Germany presents higher income per capita, and that Italy is affected by dualism in both, employment rates and income per capita. In terms of institutional differences I find that despite similar tax rates, German municipalities withhold a much greater share of income taxes collected than their Italian counterparts. The latter rely heavily on property taxes, which despite being collected mainly on second homes represent a crucial influx of revenues for Italian municipalities.
    Keywords: dataset, municipality, Germany, Italy, institutions, regional economics
    JEL: P52 O52 O57 O43 Y1
    Date: 2021
  8. By: Angeloni, Ignazio; Kasinger, Johannes; Chantawit Tantasith
    Abstract: We present new statistical indicators of the structure and performance of US banks from 1990 to today, geographically disaggregated at the level of individual counties. The constructed data set (20 indicators for some 3150 counties over 31 years, for a total of about 2 million data points) conveys a detailed picture of how the geography of US banking has evolved in the last three decades. We consider the data as a stepping stone to understand the role banks and banking policies may have played in mitigating, or exacerbating, the rise of poverty and inequality in certain US regions.
    Date: 2021
  9. By: Giovanni Pasquali
    Abstract: We explore how decent work varies across Southern Africa apparel firms participating in global value chains (GVCs) and regional value chains (RVCs), respectively. We draw on cross-section survey data from 135 workers in 31 firms across Eswatini and Lesotho, two large apparel exporters serving both global and regional markets. We use a linear probability model to estimate how measurable standards and enabling rights vary depending on whether supplier firms participate in GVCs or RVCs.
    Keywords: Regional value chains, Global value chains, Decent Work, Apparel industry, Lesotho, Eswatini, Working conditions
    Date: 2021

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