nep-geo New Economics Papers
on Economic Geography
Issue of 2024‒02‒05
five papers chosen by
Andreas Koch, Institut für Angewandte Wirtschaftsforschung

  1. The Granular Origins of Agglomeration By KIKUCHI Shinnosuke; Daniel G. O'CONNOR
  2. Racial Heterogeneity in the U.S. Structural Transformation and Regional Convergence By Kim, Minki; Lee, Munseob
  3. Business and Regional Innovation Culture: An Overview of the Conceptualization of Innovation Culture By Katimertzopoulos, Fotios; Vlados, Charis; Koutroukis, Theodore
  4. Immigration and Provision of Public Goods: Evidence at the Local Level in the U.S. By Anna Maria Mayda; Mine Z. Senses; Walter Steingress
  5. Local Export Spillovers within and between Industries in Japan By KONDO Keisuke

  1. By: KIKUCHI Shinnosuke; Daniel G. O'CONNOR
    Abstract: A few large firms dominate many local labor markets. This leaves workers vulnerable to firm-specific shocks. If one firm has a bad productivity shock in a small market, workers will be stuck with that unproductive employer, while in a large labor market, workers can move to another firm. Building on that insight, we present a model of local labor markets with a finite number of firms subject to idiosyncratic shocks. We show that there are increasing returns to scale which disappear as the number of firms goes to infinity. We also show that there can be under-entry of firms, especially in small markets. We then test the main mechanism in Japanese administrative data. We first confirm that payroll is less volatile in larger, less concentrated local labor markets. We also show that establishments with larger payroll shares respond less in adjusting employment to a demand shock. Finally, we propose a quantitative, granular model of economic geography with free entry of firms and costly mobility of workers across sectors and commuting zones that could be used to quantify our mechanisms and do counterfactuals.
    Date: 2024–01
  2. By: Kim, Minki (University of Mannheim); Lee, Munseob (University of California, San Diego)
    Abstract: Structural transformation and regional convergence in U.S. income have been long-standing trends. Caselli and Coleman (2001) discovered that 60% of regional convergence between the U.S. South and North from 1940 to 1990 is due to structural transformation. Our replication confirms these robust findings. Examining black and white populations separately, we find the magnitude of the regional income convergence was much larger for the black workers and structural transformation explains most regional income convergence for white workers but only 30% for black workers. Extending the analysis until 2020, we observe income convergence among black workers and divergence among white workers. Structural transformation's role in income convergence or divergence from 1990 to 2020 is negligible.
    Keywords: structural transformation, regional convergence, racial heterogeneity
    JEL: O1 R1
    Date: 2023–12
  3. By: Katimertzopoulos, Fotios (Democritus University of Thrace, Department of Economics); Vlados, Charis (Democritus University of Thrace, Department of Economics); Koutroukis, Theodore (Democritus University of Thrace, Department of Economics)
    Abstract: The primary aim of this paper is to identify key similarities and differences in the conceptualization of culture across the major theories of regional socioeconomic science, including economic, business, administrative, social, cultural and political dimensions acting at the regional and local scales. The second goal is to present an overview of the knowledge base and third to cohesively examine and partially recreate the topic using the semi-systematic review method. The final objective of examining the aforementioned issues is to clarify the dynamic correlation in the structuring of business and innovation culture, as well as to identify the characteristics that contribute to the sustainable culture of business and regional innovation systems, including long-term sustainable development. The research shows that the coexistence and combination of innovative culture at the business and regional levels should be perceived as a dynamic and co-evolutionary process involving a variety of factors. Local organizations and institutes that foster entrepreneurship are among the elements that enhance the innovation culture; however, having all of the resources in isolation is insufficient for an efficient ecosystem. This study proposes the establishment of a framework that will enhance the growth of innovation, cultural evolution and regional ecosystem performance. The Institutes of Local Development and Innovation (ILDI) are a policy idea that might give effective micro–meso-level solutions for the region. These policy proposals will diagnose the regional business culture under the prism of strategy, technology, and management levels. The specific investigation attempted in this paper demonstrates that several converging fruitful paths have already been created in the relative international literature. These paths could be combined and deepened further by studying the close evolutionary interconnection between business and regional innovation culture as it emerges at a global scale in the present.
    Keywords: business culture; regional culture; innovation culture; regional development; regional innovation system; Stra.Tech.Man Innovation approach; Institutes of Local Development and Innovation (ILDI)
    JEL: M14 O18 P48
    Date: 2023–12–27
  4. By: Anna Maria Mayda; Mine Z. Senses; Walter Steingress
    Abstract: Using U.S. county-level data from 1990 to 2010, we study the causal impact of immigration on the provision of local public goods. We uncover substantial heterogeneity across immigrants with different skills, mainly due to the asymmetric impact immigrants have on the per capita tax base and local revenues. In the absence of full insurance through intergovernmental transfers, the changes in per capita revenues are reflected in changes in the provision of local public services: per capita public expenditures decrease with the arrival of low-skilled immigrants and increase with the arrival of high-skilled immigrants. While the two types of immigrants offset each other on average, spatial differences in the population shares of low- and high-skilled immigrants lead to unequal fiscal effects across U.S. counties. We find the estimated impact to differ across various public services and for second-generation immigrants.
    Keywords: Fiscal policy; International topics; Regional economic developments
    JEL: F22 H41 H7 J61 J68 R5
    Date: 2023–11
  5. By: KONDO Keisuke
    Abstract: This study empirically tests the hypothesis that neighboring exporters increase the probability of export market entry (extensive margin) and export values (intensive margin). As mentioned in the international trade literature, export initiation requires additional fixed entry costs, and therefore, a high productivity is required to earn a positive profit. If neighboring establishments are already exporting, the necessary information for initiating exports is available in those areas, thus lowering entry costs. Prior studies provide mixed evidence on local export spillovers and need further validation. Using panel data on Japanese manufacturing establishments, this study provides evidence regarding intra-industry local export spillover effects on the extensive and intensive margins of exports; however, evidence concerning inter-industry local export spillovers is limited.
    Date: 2023–12

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