nep-geo New Economics Papers
on Economic Geography
Issue of 2024‒02‒12
six papers chosen by
Andreas Koch, Institut für Angewandte Wirtschaftsforschung

  1. Economic Geography and the Irish Border: A Market Access Approach By Fernihough, Alan
  2. Urban-biased structural change By Chen, Natalie; Novy, Dennis; Perroni, Carlo; Wong, Horng Chern
  3. It’s not me, it’s you: internal migration and local wages in Great Britain By Ioramashvili, Carolin
  4. A Deep Learning Representation of Spatial Interaction Model for Resilient Spatial Planning of Community Business Clusters By Haiyan Hao; Yan Wang
  5. The Determinants of the Transit Accessibility Premium By Gal Amedi
  6. Job Displacement and Local Employment Density By Maré, David C.; Fabling, Richard; Hyslop, Dean

  1. By: Fernihough, Alan
    Abstract: This paper examines the economic impact of Ireland's partition, assessing market access losses using detailed geospatial data and multimodal transport network analysis. The study reveals that partition significantly reduced market access on both sides of the border, contributing to population decline. Districts closest to the border were the most affected, with estimated population figures being approximately 10 per cent lower than they would have been without the border. This negative impact has persisted, remaining evident despite the reduction of many physical border barriers. A counterfactual analysis suggests that absent the border, the current populations of the Republic of Ireland and Northern Ireland would have been 3 per cent and 5 per cent higher, respectively. These findings illustrate the persistent role of political borders in shaping regional economic activity.
    Keywords: Economic Geography, Irish Border, Market Access, Economic History of Ireland
    JEL: R12 F15 R11 N94
    Date: 2024
  2. By: Chen, Natalie; Novy, Dennis; Perroni, Carlo; Wong, Horng Chern
    Abstract: Using firm-level data from France, we document that the shift of economic activity from manufacturing to services over the last few decades has been urban-biased: structural change has been more pronounced in areas with higher population density. This bias can be accounted for by the location choices of large services firms that sort into big cities and large manufacturing firms that increasingly locate in suburban and rural areas. Motivated by these findings, we estimate a structural model of city formation with heterogeneous firms and international trade. We find that agglomeration economies have strengthened for services but weakened for manufacturing. This divergence is a key driver of the urban bias, but it dampens aggregate structural change. Rising manufacturing productivity and falling international trade costs further contribute to the growth of large services firms in the densest urban areas, boosting services productivity and services exports, but also land prices.
    Keywords: agglomeration; cities; firm sorting; manufacturing; productivity; services; trade costs; ESRC grant ES/S007121/1; ERC TRADENET grant (714597)
    JEL: F15 F00 R12 R14
    Date: 2023–11–28
  3. By: Ioramashvili, Carolin
    Abstract: Differences in regional incomes are large and persistent in many countries. On the one hand, internal migration from low- to high-income regions might eradicate these differences over time. On the other hand, internal migration might exacerbate disparities, as receiving regions benefit from incoming skills and agglomeration economies. This paper estimates the effect of internal in- and out-migration on the earnings of employees who do not move, using a panel of employee records from Great Britain between 2004 and 2018. Employees are tracked and identified as internal migrants if they start working in a new travel-to-work area (TTWA), representing functional labour market areas. The share of in- and out-migrants is significantly correlated with earnings and earnings growth of non-migrants in a TTWA. The results show that in-migrants have an immediate negative effect on local earnings of non-migrants. After three years, in-migration is positively correlated with earnings growth. These effects are exclusively driven by urban areas. Out-migrants have no significant effects. The results provide some evidence that labour mobility can be used as a tool to encourage local growth, albeit with significant adjustment costs.
    Keywords: internal migration; labour mobility; income; earnings; labour markets; employment
    JEL: D31 R11 R23
    Date: 2023–12–21
  4. By: Haiyan Hao; Yan Wang
    Abstract: Existing Spatial Interaction Models (SIMs) are limited in capturing the complex and context-aware interactions between business clusters and trade areas. To address the limitation, we propose a SIM-GAT model to predict spatiotemporal visitation flows between community business clusters and their trade areas. The model innovatively represents the integrated system of business clusters, trade areas, and transportation infrastructure within an urban region using a connected graph. Then, a graph-based deep learning model, i.e., Graph AttenTion network (GAT), is used to capture the complexity and interdependencies of business clusters. We developed this model with data collected from the Miami metropolitan area in Florida. We then demonstrated its effectiveness in capturing varying attractiveness of business clusters to different residential neighborhoods and across scenarios with an eXplainable AI approach. We contribute a novel method supplementing conventional SIMs to predict and analyze the dynamics of inter-connected community business clusters. The analysis results can inform data-evidenced and place-specific planning strategies helping community business clusters better accommodate their customers across scenarios, and hence improve the resilience of community businesses.
    Date: 2024–01
  5. By: Gal Amedi (Bank of Israel)
    Abstract: Accessibility is a key factor in the utility from living in different areas. In urban models, accessibility is theoretically expected to be internalized by the residential market, creating an 'accessibility premium' in areas with better accessibility. Previous case-study literature found significant and largely unexplained variation in the transit accessibility premium in different urban contexts. This paper proposes a new approach to uncovering the determinants of this variation in a unified framework, utilizing a theoretically grounded measure of accessibility, and both causal machine learning and standard econometric methods applied to highly granular nationwide data on rents and the transportation network. I find that high residential density, mixed-use zoning, and a demographic composition better reflecting typical transit users imply a larger transit accessibility premium. This premium is also higher in areas with a low level of services compared to a reasonable reference point, and positive only up to a threshold level of services. There is some evidence that proximity to rail systems implies a premium over and above the expected premium implied by a reduction in travel times alone. The estimated effect is usually modest.
    JEL: R40 R31 R23 R12
    Date: 2023–06
  6. By: Maré, David C. (Motu Economic and Public Policy Research Trust); Fabling, Richard (Independent Researcher); Hyslop, Dean (Motu Economic and Public Policy Research Trust)
    Abstract: Past research finds evidence that workers' labour market outcomes are enhanced if they live in areas with greater job opportunities and employment density. Using two alternative measures of the employment density and job opportunities faced by workers in the local labour market in which they were displaced, this paper analyses their effects on the subsequent migration decisions and labour market outcomes of workers who involuntarily lose their jobs as part of a firm closure or mass layoff event. Our analysis finds only limited support for the spatial mismatch hypothesis. The results imply that workers displaced from jobs in areas with greater employment density or job opportunities are more likely to emigrate, are less likely to be re-employed following layoff and have lower subsequent earnings, although earnings are higher conditional on being employed. However, if employed, workers displaced in areas with more opportunities are less likely to have moved area, but more likely to have changed industry, and have a more similar job to that from which they were displaced.
    Keywords: displaced workers, unemployment duration, local labour markets
    JEL: J62 J64 R23
    Date: 2023–12

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