nep-geo New Economics Papers
on Economic Geography
Issue of 2024‒04‒29
four papers chosen by
Andreas Koch, Institut für Angewandte Wirtschaftsforschung

  1. Regional productivity differences in the UK and France - from the micro to the macro By Bridget Kauma; Giordano Mion
  2. The impact of skills shortage on economic development in Germany – A mixed method approach By Hertrich, Tobias Johannes; Brenner, Thomas
  3. Bridging the innovation gap. AI and robotics as drivers of China’s urban innovation By Andrés Rodríguez-Pose; Zhuoying You;
  4. On the Spatial Allocation of College Seats: Human Capital Production and the Distribution of Skilled Labor By Yang, Yu (Alan)

  1. By: Bridget Kauma (University of Sussex); Giordano Mion (ESSEC Business School)
    Keywords: Firm-level dataset, Merging, BSD, FAME, VAT, FICUS, FARE, Productivity, Markups, UK, France, regional disparities, density
    JEL: R12 D24
    Date: 2023–11
  2. By: Hertrich, Tobias Johannes; Brenner, Thomas
    Abstract: In Europe, there is an increasing shortage of skilled workers and jobs remain vacant for long periods of time. The shortage of skilled workers has become a key issue for various stakeholders, as it not only makes it difficult to recruit and retain employees, but it is also seen as a significant barrier to innovation for companies. So far, most analyses of skills shortage take place at company level. We supplement this with a regional perspective, because many measures, especially those of policy makers, are conducted on the regional level. We examine the impact of skills shortage on various aspects of regional economic development. Using the spatial vector autoregressive panel model, significant effects on gross domestic product (GDP), employment are found, but not on research and development (R&D) activities. Expert interviews are used to dig deeper into the reasons for these findings, showing that the disadvantages of skills shortages on innovativeness are perceived, but relate to the future or to the more general economic situation.
    Abstract: In Europa herrscht ein zunehmender Mangel an qualifizierten Arbeitskräften, und Stellen bleiben über lange Zeiträume unbesetzt. Der Fachkräftemangel ist für verschiedene Interessengruppen zu einem zentralen Thema geworden, da er nicht nur die Einstellung und Bindung von Mitarbeitern erschwert, sondern auch als erhebliches Innovationshemmnis für Unternehmen angesehen wird. Bislang wurden die meisten Analysen des Fachkräftemangels auf Unternehmensebene durchgeführt. Wir ergänzen dies um eine regionale Perspektive, da viele Maßnahmen, insbesondere die der politischen Entscheidungsträger, auf regionaler Ebene durchgeführt werden. Wir untersuchen die Auswirkungen des Fachkräftemangels auf verschiedene Aspekte der regionalen Wirtschaftsentwicklung. Unter Verwendung des räumlichen vektorautoregressiven Panelmodells werden signifikante Auswirkungen auf das Bruttoinlandsprodukt (BIP) und die Beschäftigung festgestellt, nicht jedoch auf die Forschungs- und Entwicklungsaktivitäten (FuE). Experteninterviews werden genutzt, um die Gründe für diese Ergebnisse zu ergründen, und zeigen, dass die Nachteile des Fachkräftemangels für die Innovationsfähigkeit zwar wahrgenommen werden, sich aber auf die Zukunft oder die allgemeine Wirtschaftslage beziehen.
    Keywords: skills shortage, regional development, regional innovativeness, mixed methods
    JEL: O10 O30 J23 J21 J11
    Date: 2024
  3. By: Andrés Rodríguez-Pose; Zhuoying You;
    Abstract: Artificial intelligence (AI) and robotics are revolutionising production, yet their potential to stimulate innovation and change innovation patterns remains underexplored. This paper examines whether AI and robotics can spearhead technological innovation, with a particular focus on their capacity to deliver where other policies have mostly failed: less developed cities and regions. We resort to OLS and IV-2SLS methods to probe the direct and moderating influences of AI and robotics on technological innovation across 270 Chinese cities. We further employ quantile regression analysis to assess their impacts on innovation in more and less innovative cities. The findings reveal that AI and robotics significantly promote technological innovation, with a pronounced impact in cities at or below the technological frontier. Additionally, the use of AI and robotics improves the returns of investment in science and technology (S&T) on technological innovation. AI and robotics moderating effects are often more pronounced in less innovative cities, meaning that AI and robotics are not just powerful instruments for the promotion of innovation but also effective mechanisms to reduce the yawning gap in regional innovation between Chinese innovation hubs and the rest of the country.
    Keywords: AI, robotics, China, technological innovation, territorial inequality
    Date: 2024–04
  4. By: Yang, Yu (Alan)
    Abstract: How to allocate college seats across regions is an important yet largely neglected issue. It may imply a policy tradeoff between efficiency in aggregate human capital production and equality of opportunities for people growing up in different places. Furthermore, the flow of college attendance, resulting from the geography of college seats, also impacts the spatial distribution of skilled workers through post-college migration and regional inequality in future development. This paper studies this tradeoff between efficiency and multidimensional inequality in the spatial allocation of college seats by focusing on the province-based college admission quotas in China, the largest college market in the world. Combining national administrative data and surveys, I estimate a structural model of college and migration choice under quota constraints, together with a measurement model that can recover the nationally comparable distribution of pre-college human capital in each province. There are substantial skill gaps between college applicants across provinces, but this disparity is not well reflected in the allocated admission quotas. A purely merit-based nationwide admission increases aggregate human capital at the cost of worse college opportunities and substantially more severe brain drain in less developed regions, while equalized admission leads to the opposite outcome. Comparing the current quota system against the efficiency-equality frontier suggests that China places a larger policy weight toward a more equalized spatial supply of skilled labor.
    Keywords: Place-based college admission, human capital, spatial sorting, regional inequality
    JEL: I23 I24 J24 J61 R23
    Date: 2024–03–01

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