nep-geo New Economics Papers
on Economic Geography
Issue of 2023‒09‒04
eight papers chosen by
Andreas Koch, Institut für Angewandte Wirtschaftsforschung

  1. Regional vulnerability to the green transition By Rodríguez-Pose, Andrés; Bartalucci, Federico
  2. Regional employment effects of the Hartz-reforms By Hörnig, Lukas
  3. Spatial wage inequality in North America and Western Europe: changes between and within local labour markets 1975-2019 By Bauluz, Luis; Bukowski, Pawel; Fransham, Mark; Lee, Annie; López Forero, Margarita; Novokmet, Filip; Breau, Sébastien; Lee, Neil; Malgouyres, Clement; Schularick, Moritz; Verdugo, Gregory
  4. Service Trade, Regional Specialization, and Welfare By Yuancheng Han; Jorge Miranda-Pinto; Satoshi Tanaka
  5. Digitalisation in European regions: Unravelling the impact of relatedness and complexity on digital technology adoption and productivity growth By Stefan Apostol; Eduardo Hernández-Rodríguez
  6. Remote Work and City Structure By Ferdinando Monte; Charly Porcher; Esteban Rossi-Hansberg
  7. Political favoritism and internal migration in Benin By Stöcker, Alexander; Baskaran, Thushyanthan; Hufschmidt, Patrick
  8. The Spanish municipal population database (ESPOP) 1860-1930 By Francisco J. Beltran Tapia; Alfonso Diez Minguela; Julio Martinez Galarraga; Daniel A. Tirado Fabregat

  1. By: Rodríguez-Pose, Andrés (Cañada Blanch Centre and Department of Geography and Environment, London School of Economics); Bartalucci, Federico (Cañada Blanch Centre and Department of Geography and Environment, London School of Economics)
    Abstract: The impacts of climate change are unevenly distributed across territories. Less is known about the potential effects of climate policies aimed at mitigating the negative consequences of climate change, while transitioning economies towards low-carbon standards. This paper presents an analytical framework for identifying and assessing the regional impacts of the green transition. We develop a Regional Green Transition Vulnerability Index, a composite measure of the regional vulnerability of European regions to the socio- economic reconfigurations prompted by the green transition. The index brings to light strong regional variations in vulnerability, with less developed, peri-urban, and rural regions in Southern and Eastern Europe more exposed to the foreseeable changes brought about by the green transition. We also draw attention to the potential rise of pockets of growing ‘green’ discontent, especially if the green transition contributes, as is likely to be the case, to leaving already left-behind regions further behind.
    Keywords: Green transition, environment, left-behind regions, development trap, European Union
    JEL: O44 Q56 R11
    Date: 2023–07
  2. By: Hörnig, Lukas
    Abstract: Between 2003 and 2005, the German government passed an unprecedented package of labor market reforms, commonly known as the Hartz-reforms. This led to a "labor market miracle" with sharply declining unemployment rates. This paper examines these reforms at the regional level and provides a comprehensive picture of whether the reforms have exacerbated or reduced regional disparities. I apply a regional difference-in-differences framework commonly used in the minimum wage evaluation literature to analyze the effect of the reforms on employment at the county level. The empirical results show that while all counties benefited from the Hartz-reforms, more prosperous counties derived a stronger benefit than those with high unemployment rates. The evidence is stronger for West Germany than for East Germany. Overall, the reforms have not improved economic performance homogeneously, but have actually increased regional disparities.
    Keywords: Regional growth, policy evaluation, regional convergence, Hartz-reforms
    JEL: R11 J48 O47
    Date: 2023
  3. By: Bauluz, Luis; Bukowski, Pawel; Fransham, Mark; Lee, Annie; López Forero, Margarita; Novokmet, Filip; Breau, Sébastien; Lee, Neil; Malgouyres, Clement; Schularick, Moritz; Verdugo, Gregory
    Abstract: The rise of economic inequalities in advanced economies has been often linked with the growth of spatial inequalities within countries, yet there is limited comparative research that studies the relationship between national and subnational economic inequality. This paper presents the first systematic attempt to create internationally comparable evidence showing how different countries perform in terms of geographic wage inequalities. We create cross-country comparable measures of spatial wage disparities between and within similarly-defined local labour market areas (LLMAs) for Canada, France, (West) Germany, the UK and the US since the 1970s, and assess their contribution to national inequality. By the end of the 2010s, spatial inequalities in LLMA mean wages are similar in Canada, France, Germany and the UK; the US exhibits the highest degree of spatial inequality. Over the study period, spatial inequalities have nearly doubled in all countries, except for France where spatial inequalities have fallen back to 1970s levels. Due to a concomitant increase in within-place inequality, the contribution of places in explaining national wage inequality has remained fairly constant over the 40-year study period, except in the UK where we document a significant increase. Whilst common global social, economic and technological shocks are important drivers of spatial inequality, this variation in levels and trends of spatial inequality opens the way to comparative research exploring the role of national institutions in mediating how global shocks translate into economic disparities between places.
    Keywords: regional inequality; wage inequality; local labour markets
    JEL: J30 R10 R23
    Date: 2023–08–01
  4. By: Yuancheng Han; Jorge Miranda-Pinto; Satoshi Tanaka
    Abstract: How much does trade in services affect regional production specialization and welfare? Using unique Canadian trade data, we document that the size of inter-provincial service trade is comparable to that of good trade, and that net exports of services are highly correlated with the value-added share of tradable services across provinces. With a spatial model featuring domestic and international trade, we quantify the effects of service trade. Our results highlight that domestic service trade significantly promotes regional specialization, with heterogeneous welfare gains that reduce regional disparities. Conversely, international service trade generates more uniform welfare gains across provinces.
    Keywords: service trade, domestic trade, regional specialization, regional disparities, welfare, structural transformation
    JEL: E20 F10 L16
    Date: 2023–08
  5. By: Stefan Apostol; Eduardo Hernández-Rodríguez
    Abstract: Digitalisation has become a clear policy objective. Regions want to digitalise their economies to benefit from the digital world. This paper provides empirical evidence on how the adoption of new digital web technologies is shaped by previous regional digital capabilities. The analysis is based upon an economic complexity and relatedness framework using novel data on digital web technologies’ adoption for 278 European NUTS-2 regions between years 2000-2022. Results show that regions tend to adopt new digital web technologies when they already master related digital capabilities. This paper also shows how digital complexity is associated with labour productivity gains at the regional level. Conclusions shed light on how regions are adopting digital web technologies and serve as a tool for policymakers.
    Keywords: Digitalisation; digital web technologies; relatedness; economic complexity; productivity; European regions
    JEL: L86 O14 O33 R11
    Date: 2023–08
  6. By: Ferdinando Monte (Georgetown University); Charly Porcher (Georgetown University); Esteban Rossi-Hansberg (University of Chicago)
    Abstract: We study the adoption of remote work within cities and its effect on city structure and welfare. We develop a dynamic model of a city in which workers can decide to work in the central business district (CBD) or partly at home. Working in the CBD allows them to interact with other commuters, which enhances their productivity through a standard production externality, but entails commuting costs. Switching between modes of labor delivery is costly, and workers face idiosyncratic preference shocks for remote work. We characterize the parameter set in which the city exhibits multiple stationary equilibria. Within this set, a coordination mechanism can lead to stationary equilibria in which most workers commute or most of them work partially from home. In these cases, large shocks in the number of commuters, like the recent lockdowns and self-isolation generated by the COVID-19 pandemic, can result in dynamic paths that make cities converge to a stationary equilibrium with large fractions of remote workers. Using cell-phone-based mobility data for the U.S., we document that although most cities experienced similar reductions in CBD trips during the pandemic, trips in the largest cities have stabilized at levels that are only about 60% of pre-pandemic levels. In contrast, smaller cities have, on average, returned to pre-pandemic levels. House price panel data by city show consistent changes in house price CBD-distance gradients. We estimate the model for 274 U.S. cities and show that cities that have stabilized at a large fraction of remote work are much more likely to have parameters that result in multiple stationary equilibria. Our results imply welfare losses in these cities that average 2.7%.
    Keywords: city structure, commuting, COVID-19
    JEL: R23 J24 C62
    Date: 2023–08
  7. By: Stöcker, Alexander; Baskaran, Thushyanthan; Hufschmidt, Patrick
    Abstract: In this paper we explore the role of regional connections with a national leader as a pull factor of internal migration in Benin by exploiting granular census data over the period 1991-2013. The empirical analysis is based on a gravity model of migration and utilizes a PPML estimator. Controlling for a diverse set of fixed effects, we show that being connected to a national leader goes along with statistically significant levels of migration into the respective districts. We also provide more detailed evidence that links these migration movements to the presence of political favoritism through its ability to improve economic opportunities and the access to public goods at the local level. The evidence in this paper blends in well with the related literature on political favoritism extending it by a previously unexplored dimension.
    Keywords: Favoritism, internal migration, spatiality, luminosity, Africa
    JEL: D73 R11 R23 O55
    Date: 2023
  8. By: Francisco J. Beltran Tapia (NTNU); Alfonso Diez Minguela (Universitat de Valencia); Julio Martinez Galarraga (Universitat de Barcelona); Daniel A. Tirado Fabregat (Universitat de Valencia)
    Abstract: In this paper we introduce ESPOP, a spatial data infrastructure with municipal-level information for Spain from 1860 to 1930. ESPOP offers de facto population for the universe of municipalities (over 9, 000) as reported in 7 censuses (1860, 1877, 1887, 1900, 1910, 1920 and 1930). Given their changing nature, a relevant contribution is that it also provides local de facto population for 9, 130 homogeneous municipalities thereby allowing for consistent intertemporal comparisons. Additionally, municipalities are georeferenced which in turn facilitates the integration of other spatial data infrastructures. ESPOP thus culminates a long process that has benefitted from the work of the Instituto Nacional de Estadística (INE) and a good number of researchers.
    Keywords: Spain, population, history
    JEL: J11 R11 R23 N33 N34
    Date: 2023–05

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