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on Economic Geography |
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Issue of 2025–10–20
seven papers chosen by Andreas Koch, Institut für Angewandte Wirtschaftsforschung |
| By: | Yibo Qiao; Yingcheng Li; Ron Boschma |
| Abstract: | Place dependence is a widely recognized concept but has rarely been quantified in existing research. Employing the Wasserstein Distance algorithm from machine learning literature and China’s Annual Survey of Industrial Firms dataset, this paper introduces a novel method to measure the place dependence of industrial dynamics in Chinese cities, and explore its impact on urban economic performance. Our empirical findings confirm the presence of place dependence in Chinese cities, and show that cities diversifying into more related and complex industries tend to exhibit higher levels of place dependence. Moreover, place dependence appears to complement the effects of relatedness and complexity in enhancing urban economic performance. These findings offer important insights for regional industrial development and urban planning practices. |
| Keywords: | Place dependence, path dependence, knowledge complexity, industrial dynamics, economic performance, China |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:egu:wpaper:2531 |
| By: | Treb Allen; Winston Chen; Suresh Naidu |
| Abstract: | What would the antebellum American economy have looked like without slavery? Using new micro-data on the U.S. economy in 1860, we document that where free and enslaved workers live and how much they earn correlates strongly—but differently—with geographic proxies for agricultural productivity, disease, and ease of slave escape. To explain these patterns, we build a quantitative spatial model of slavery, where slaveholders coerce enslaved workers into supplying more labor, capture the proceeds of their labor, and assign them to sectors and occupations that maximize owner profits rather than worker welfare. Combining theory and data, we then quantify how dismantling the institution of slavery affected the spatial economy. We find that the economic impacts of emancipation are substantial, generating welfare gains for the enslaved of roughly 1, 200%, while reducing welfare of free workers by 0.7% and eliminating slaveholder profit. Aggregate GDP rises by 9.1%, with a contraction in agricultural productivity counteracted by an expansion in manufacturing and services driven by an exodus of formerly enslaved workers out of agriculture and into the U.S. North. |
| JEL: | J47 N51 O17 R1 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34356 |
| By: | Mohamed Bahlali (Aix-Marseille Univ., CNRS, AMSE, Marseille, France); Raouf Boucekkine (Aix-Marseille Univ., CNRS, AMSE, Marseille, France); Quentin Petit (EDF & FiME Lab, Paris, France) |
| Abstract: | We propose a mean-field game (MFG) set-up to study the dynamics of spatial agglomeration in a continuous space-time framework where trade across locations may follow a broad class of static gravity models. Forward-looking intertemporal utility-maximizing agents work and migrate in a twodimensional geography and face idiosyncratic shocks. Equilibrium wages and prices depend on their common distribution and adjust statically according to the underlying trade model. We first prove existence and uniqueness of the static trade equilibrium. We then prove existence of dynamic equilibria. In the case of Krugman (1996)'s racetrack economy, we obtain closed-form solutions for small sinusoidal perturbations around the steady state, and we identify the sets of parameters that lead to agglomeration or dispersion. We exploit the MFG structure of the model to explicitly quantify how uncertainty and forward-looking expectations contribute to agglomeration and dispersion. In particular, we show that, regardless of the static trade model, forward-looking expectations always promote agglomeration, but cannot reverse the dominant pattern that would arise under myopic behavior. |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:aim:wpaimx:2517 |
| By: | Griniece Elina; Reid Alasdair; Miedzinski Michal (European Commission - JRC) |
| Abstract: | "This report explores the role of local and regional actors in mission-oriented innovation and industrial policies. It examines how current mission-oriented approaches engage regions, cities, and rural communities in mission design and implementation, and whether these policies have the potential to contribute to ‘competitive sustainability’ in the European Union (EU). The study finds that despite the development of vertical coordination structures, EU missions and many national mission-oriented innovation policies (MOIPs) lack effective multi-level collaboration mechanisms resulting in limited regional and local ownership of missions. There is a need for a higher degree of involvement of territorial stakeholders in the design and implementation of missions. The study provides lessons for place-based industrial missions, using the example of the automotive industry and sustainable mobility. It argues that a socially concerned industrial mission for the automotive sector should address differing dimensions depending on the type of region, such as urban or rural areas. The report emphasises the need for enabling frameworks that allow regions and cities to co-shape missions, and for mechanisms of ongoing evaluation and learning to capture new ideas and channel them into MOIPs." |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc143455 |
| By: | Mccann Philip; Stierna Johan (European Commission - JRC) |
| Abstract: | "In this paper we examine the key insights and recommendations of the Draghi report, alongside those of the Letta report. We argue that many of the issues raised are relevant, timely, pertinent, and in some cases urgent. However, we also argue that the attainment of the recommended aims and objectives of the Draghi report are contingent on transition mechanisms, many of which are explicitly regional in nature. Looking through the lens of economic geography it becomes apparent that the implicit model of economic growth underpinning both the Draghi and Letta reports is a framework from the 1990s. However, in recent decades Europe has undergone profound changes to the economic geography of growth, many of which fundamentally change the foundations of the logic underpinning the Draghi report. The fact that neither the Draghi nor Letta reports acknowledge these profound changes means that both reports have to be reconsidered, and we argue that the processes and mechanisms for change are rather different to those which the reports acknowledge." |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc142670 |
| By: | Camilo Ulloa; Agustín García; Joxe Mari Barrutiabengoa |
| Abstract: | Este documento presenta un marco metodológico para cuantificar el impacto económico de desastres naturales. Estima una función de daños y mide los efectos sobre el empleo usando un modelo espacial dinámico. La DANA 2024 en Valencia valida el enfoque, y destaca la importancia de la localización y las indemnizaciones. This paper presents a methodological framework to quantify the economic impact of natural disasters. It estimates a damage function and measures employment effects using a dynamic spatial model. The 2024 DANA in Valencia validates the approach and highlights the importance of both location and compensation mechanisms. |
| Keywords: | DANA, DANA, Employment, Empleo, Climate change, Cambio climático, Global, Global, Europe, Europa, Spain, España, Macroeconomic Analysis, Análisis Macroeconómico, Regional Analysis Spain, Análisis Regional España, Climate Sustainability, Sostenibilidad Climática, Working Paper, Documento de Trabajo |
| JEL: | Q54 E24 R11 C33 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:bbv:wpaper:2513 |
| By: | Fremerey, Melinda; Gerards Iglesias, Simon |
| Abstract: | Auch 35 Jahre nach der deutschen Einheit wird in Politik und Öffentlichkeit weiterhin intensiv darüber diskutiert, welche Unterschiede zwischen Ost und West bestehen und wie weit das Land tatsächlich zusammengewachsen ist. Besonders deutlich treten diese Differenzen im politischen Wahlverhalten zutage: Auch wenn sich das Ost-West-Gefälle beim Stimmenanteil für die rechtsextreme Partei AfD bei den letzten Bundestagswahlen verringert hat, zeigen sich nach wie vor markante Unterschiede zwischen ost- und westdeutschen Regionen im Wahlverhalten. Diese Trennlinie verläuft oft sogar mitten durch Nachbargemeinden. Vor diesem Hintergrund widmet sich dieses Paper den sogenannten Grenzregionen. Darunter verstehen wir Gemeinden, die direkt an der früheren innerdeutschen Grenze liegen. Diese Grenzräume eignen sich besonders gut, um die Entwicklung seit der Wiedervereinigung zu untersuchen, weil sie durch ihre Lage unmittelbar von der historischen Teilung geprägt waren und geographisch heute ähnlich verortet sind. Ziel dieser Studie ist, ihre wirtschaftliche, soziale und politische Entwicklung im Vergleich zu anderen Regionen systematisch zu analysieren. Dadurch lässt sich erkennen, welche Unterschiede fortbestehen, wo Angleichungsprozesse erfolgreich verlaufen sind und in welchen Bereichen weiterhin Divergenzen sichtbar bleiben. |
| Abstract: | 35 years after German reunification, there is still intense debate in politics and public discourse about the differences between East and West and the extent to which the country has actually grown together. These differences are particularly evident in political behavior: elections reveal striking differences between eastern and western German regions-for example, in support for the far-right party Alternative for Germany, or AfD, whose approval ratings are significantly higher east of the former inner-German border. This historical dividing line is thus still visible today and often even runs right through neighboring communities. Against this backdrop, this paper focuses on the so-called border regions. By this we mean communities that lie directly on the former inner-German border. These border areas are particularly well suited for examining developments since reunification because their location meant they were directly affected by the historical division. The aim is to systematically analyze their economic, social, and political development in comparison with other regions. This will reveal which differences remain, where convergence processes have been successful, and in which areas divergences remain visible. |
| JEL: | R12 R23 R58 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:iwkrep:328259 |