nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2010‒11‒13
forty papers chosen by
Steve Ross
University of Connecticut

  1. Public Housing Units vs. Housing Vouchers: Accessibility, Local Public Goods, and Welfare By Sinan Sarpca; Charles Ka Yui Leung; Kuzey Yilmaz
  2. Spatial Dependencies in German Matching Functions By Franziska Schulze
  3. Investigation of Roadside Particulate Matter Concentration Surrounding Major Arterials in Five Southern Californian Cities By Pan, Hansheng; Bartolome, Christian; Princevac, Marko; Edwards, Rufus; Boarnet, Marlon
  4. House Prices and Risk Sharing By Hryshko, Dmytro; Luengo-Prado, Maria; Sorensen, Bent
  5. Sources of the rural-urban productivity disparities and the policy implications on rural development in Korea By Kim, Hanho; Gopinath, Manisamy
  6. Labour Market Impact of Large Scale Internal Migration on Chinese Urban 'Native' Workers By Meng, Xin; Zhang, Dandan
  7. R&D-Persistency, Metropolitan Externalities and Productivity By Lööf, Hans; Johansson, Börje
  8. The Choice Between Fixed and Random Effects Models: Some Considerations for Educational Research By Clarke, Paul; Crawford, Claire; Steele, Fiona; Vignoles, Anna
  9. Economic Linkages Across Space.. By Overman, Henry G.; Rice, Patricia; Venables, Anthony J.
  10. Voting on traffic congestion policy with two levels of government By Russo, Antonio
  11. Decomposing regional efficiency By Schaffer, Axel; Simar, Léopold; Rauland, Jan
  12. Spatial Relocation with Heterogeneous Firms and Heterogeneous Sectors By Forslid, Rikard; Okubo, Toshihiro
  13. Increased patronage for urban bus transport with net-cost contracts By Pyddoke, Roger; Andersson, Matts
  14. Urban Cooperative Banks: A Case Study of Karnataka By SAHA, AMRITA
  15. Spatial Structure of the Food Industry in Germany By Gouzhary, Izhar; Margarian, Anne
  16. Connectivity of vehicular ad hoc networks with continuous node distribution patterns By Jin, W L; Wang, Bruce
  17. Regional Variation in Informal Employment: Skills, Norms, and Government Effectiveness By Jonasson, Erik
  18. Networks as determinants of rural migration By Zarnekow, Nana; Henning, Christian H.C.A
  19. The Life-Cycle Hypothesis Revisited: Evidence on Housing Consumption after Retirement By Miriam Beblow; Sven Schreiber
  20. Cost of a Ride: The Effects of Densities on Fixed-Guideway Transit Ridership and Capital Costs By Guerra, Erick; Cervero, Robert
  21. Fiscal Decentralization and Development: How Crucial is Local Politics? By Pal, Sarmistha; Roy, Jaideep
  22. The Effect of Market Entry on Innovation: Evidence from UK University Incubators By Christian Helmers
  23. Leadership and Innovation under Decentralization : A Case Study of Selected Local Governments in the Philippines By Joseph J. Capuno
  24. An analysis of the educational progress of children with special educational needs By Claire Crawford; Anna Vignoles
  25. Agglomeration Economies in Ukrainian Dairy Sector: a Marked Point Process Approach By Brummer, Bernhard; Von Cramon-Taubadel, Stephan; Nivievskyi, Oleg; Schlather, Martin
  26. Consumers and sellers heterogeneity, search costs and spatial price dispersion in retail food markets By Anania, Giovanni; Nistico, R
  27. Norms, Culture and Local Infrastructure: Evidence from a Decentralised Economy By Pal, Sarmistha
  28. Are City Logistics Solutions Sustainable? The Cityporto case By Jesus Gonzalez-Feliu; Joelle Morana
  29. The relationship between spatial price transmission and geographical distance: the case of Brazil By HernandezâVillafuerte, Karla
  30. Macroeconomic and bank-specific determinants of non-performing loans in Greece: a comparative study of mortgage, business and consumer loan portfolios By Dimitrios P. Louzis; Aggelos T. Vouldis; Vasilios L. Metaxas
  31. Fine Particulate Concentrations Near Arterial Streets: The Influence of Building Placement and Wind Flow By Boarnet, Marlon G.; Ferguson, Gavin; Edwards, R D; Princevac, Marko; Bartolome, Christian; Pan, Hansheng
  32. Short-run learning dynamics under a test-based accountability system : evidence from Pakistan By Barrera-Osorio, Felipe; Raju, Dhushyanth
  33. A Longitudinal Analysis of Moving Desires, Expectations and Actual Moving Behaviour By Coulter, Rory; van Ham, Maarten; Feijten, Peteke
  34. Identification of spatial agglomerations in the German food processing industry By Hoffmann, J.
  35. Spreading the Word: Geography, Policy and University Knowledge Diffusion By Sharon Belenzon; Mark Schankerman
  36. Mortgage Choice as a Natural Field Experiment on Choice Under Risk By Philomena M. Bacon; Peter Moffatt
  37. Is Poor Fitness Contagious? Evidence from Randomly Assigned Friends By Scott E. Carrell; Mark Hoekstra; James E. West
  38. Friends’ Networks and Job Finding Rates By Lorenzo Cappellari; Konstantinos Tatsiramos
  39. Economical Crime Control By Philip J. Cook; Jens Ludwig
  40. Questioning polycentric development and its effects: issues of definition and measurement for the Italian NUTS 2 Regions By Veneri, Paolo; Burgalassi, David

  1. By: Sinan Sarpca (Koc University); Charles Ka Yui Leung (City University of Hong Kong); Kuzey Yilmaz (Koc University)
    Abstract: A perennial debate worldwide over housing aid policy focuses on whether the government should provide housing vouchers or subsidized public housing units. To complement the empirically- dominated literature, this paper builds a general equilibrium model that merges urban land use (monocentric city) and Tiebout frameworks. In our model, public housing units or housing vouchers are rationed and some lower-income people have to compete with those with higher incomes in the private rental market. We discuss how location of public housing units is an essential policy variable in addition to the numbers and sizes of units, and argue why housing vouchers may be preferable to public housing.
    Keywords: Conditional CAPM
    Date: 2010–11
  2. By: Franziska Schulze
    Abstract: This paper proposes a spatial panel model for German matching functions to avoid possibly biased and inefficient estimates due to spatial dependence. We provide empirical evidence for the presence of spatial dependencies in matching data. Based on an official data set containing monthly information for 176 local employment offices, we show that neglecting spatial dependencies in the data results in overestimated coefficients. For the incorporation of spatial information into our model, we use data on commuting relations between local employment offices. Furthermore, our results suggest that a dynamic modeling is more appropriate for matching functions.
    Keywords: Empirical Matching, Geographic Labor Mobility, Spatial Dependence, Regional Unemployment
    JEL: C21 C23 J64 J63 R12
    Date: 2010–11
  3. By: Pan, Hansheng; Bartolome, Christian; Princevac, Marko; Edwards, Rufus; Boarnet, Marlon
    Abstract: Vehicular emissions from arterials may present a risk to public health considering the type of surrounding built environments that can trap pollutants. In order to study the influence of urban morphometry on flow and dispersion of vehicular emissions, field measurements were performed in major arterials in 5 Southern Californian cities with different building geometries. Local mean wind, turbulence, virtual temperature, roadside fine particulate matter (PM2.5) concentration, and traffic flow data were collected in summer 2008. In each city, data were collected for three days, covering two hours during the morning and evening commute and lighter mid-day traffic. First, the observation shows the influence of building geometry on street level concentration of particulates. Tall buildings cause a strong downdraft which upon impinging the street level flushes street canyon from pollutants. Second, field experiments help us understand the influence of local meteorological variables and their interaction with urban canopy to particle concentration. Concentrations at the windward side of buildings within urban canopy are extremely sensitive to wind direction. In addition to wind direction, turbulent flux, sensible heat flux and turbulent velocity are also affecting concentrations by enhancing vertical transport.
    Date: 2010–08–01
  4. By: Hryshko, Dmytro (University of Alberta, Department of Economics); Luengo-Prado, Maria (Northeastern University); Sorensen, Bent (University of Houston)
    Abstract: Homeowners in the Panel Study of Income Dynamics are able to maintain a high level of consumption following job loss (or disability) in periods of rising local house prices while the consumption drop for homeowners who lose their job in times of lower house prices is substantial. These results are consistent with homeowners being able to access wealth gains when housing appreciates as witnessed by their ability to smooth consumption more than renters. A calibrated model of endogenous homeownership and consumption is able to reproduce the patterns in the data quite well and provides an interpretation of the empirical results.
    Keywords: job displacement; disability; housing collateral
    JEL: D91 E21
    Date: 2010–09–01
  5. By: Kim, Hanho; Gopinath, Manisamy
    Abstract: This paper investigates the effect of trade cost changes on the spatial productivity distribution in Korea. Data on gross value added and primary factors for 163 spatial units during 2000-2005 are assembled to estimate local TFP using a value-added function. In our application, we control for agglomeration economies so as to identify factors shifting the regional raw-productivity distribution over time. The TFP estimation results show that the Korean regional economy exhibits constant returns to scale, along with significant localization economies. We find that and trade costs reduction and infrastructure improvement significantly shift to the right all percentile values of the regional productivity distribution, while amenity does not affect the movement of the distribution. An important policy implication of this study is that a country pursuing foreign market opportunities to boost economic growth and to raise incomes, like Korea, should also consider the consequent spatial realignment of resources. Also, productivity enhancements along with transfers to alleviate adjustments to trade-cost changes cannot be space blind.
    Keywords: agglomeration economies, spatial productivity distribution, trade cost, Community/Rural/Urban Development, F1, R3,
    Date: 2010–08
  6. By: Meng, Xin (Australian National University); Zhang, Dandan (Australian National University)
    Abstract: Hundreds of millions of rural migrants have moved into Chinese cities since the early 1990s contributing greatly to economic growth, yet, they are often blamed for reducing urban 'native' workers’ employment opportunities, suppressing their wages and increasing pressure on infrastructure and other public facilities. This paper examines the causal relationship between rural-urban migration and urban native workers' labour market outcomes in Chinese cities. After controlling for the endogeneity problem our results show that rural migrants in urban China have modest positive or zero effects on the average employment and insignificant impact on earnings of urban workers. When examine the impact on unskilled labours we once again find it to be positive and insignificant. We conjecture that the reason for the lack of adverse effects is due partially to the labour market segregation between the migrants and urban natives, and partially due to the complementarities between the two groups of workers. Further investigation reveals that the increase in migrant inflow is related to the demand expansion and that if the economic growth continues, elimination of labour market segregation may not necessarily lead to an adverse impact of migration on urban native labour market outcomes.
    Keywords: migration, native labour market outcomes, China
    JEL: J80 J45
    Date: 2010–10
  7. By: Lööf, Hans (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Johansson, Börje (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: Firms display persistent differences as regards both internal and external characteristics, and these differences correspond to asymmetries in the performance of firms with regard to productivity level and growth as well as innovativeness. This paper focuses on one internal characteristic and one external factor by distinguishing between firms with persistent R&D efforts and other firms and firms located in a metropolitan region versus firms with other locations. Applying Swedish data on individual firms and their location, the paper shows that firms that follow a strategy with persistent R&D efforts have a distinctly higher level of productivity across all types of location. In addition, the productivity level of firms with persistent R&D is augmented in a significant way when such firms have a metropolitan location and, in particular, a location in a metropolitan city
    Keywords: R&D; innovation-strategy; productivity; metropolitan; externalities
    JEL: C23 O31 O32
    Date: 2010–11–04
  8. By: Clarke, Paul (University of Bristol); Crawford, Claire (Institute for Fiscal Studies, London); Steele, Fiona (University of Bristol); Vignoles, Anna (Institute of Education, University of London)
    Abstract: We discuss fixed and random effects models in the context of educational research and set out the assumptions behind the two approaches. To illustrate the issues, we analyse the determinants of pupil achievement in primary school, using data from the Avon Longitudinal Study of Parents and Children. We conclude that a fixed effects approach will be preferable in scenarios where the primary interest is in policy-relevant inference of the effects of individual characteristics, but the process through which pupils are selected into schools is poorly understood or the data are too limited to adjust for the effects of selection. In this context, the robustness of the fixed effects approach to the random effects assumption is attractive, and educational researchers should consider using it, even if only to assess the robustness of estimates obtained from random effects models. When the selection mechanism is fairly well understood and the researcher has access to rich data, the random effects model should be preferred because it can produce policy-relevant estimates while allowing a wider range of research questions to be addressed. Moreover, random effects estimators of regression coefficients and shrinkage estimators of school effects are more statistically efficient than those for fixed effects.
    Keywords: fixed effects, random effects, multilevel modelling, education, pupil achievement
    JEL: C52 I21
    Date: 2010–10
  9. By: Overman, Henry G.; Rice, Patricia; Venables, Anthony J.
    Abstract: We develop a diagrammatic framework that can be used to study the economic linkagesbetween regions or cities. Hitherto, such linkages have not been the primary focus of eitherthe theoretical or empirical literatures. We show that our general framework can be used tointerpret both the New Economic Geography and Urban Systems literatures to help usunderstand spatial economic linkages. We then extend the theoretical framework to allow usto consider a number of additional issues which may be particularly important for analyzingthe impact of policy. Such policy analysis will also require empirical work to identify thenature of key relationships. In a final section, we consider what the existing empiricalliterature can tell us about these relationships.
    JEL: R58 R00
    Date: 2010
  10. By: Russo, Antonio
    Abstract: I study how the political decision process affects urban traffic congestion policy. First, I look at the case of a single government deciding, through majority voting, on a monetary charge to be paid to drive to a city's Central Business District (CBD): if the majority of individuals prefers to drive more (resp. less) than the average, a voting equilibrium with lower (higher) charge emerges. Next, I consider the case of two government levels involved in traffic policy: parking charges in (resp. cordon tolls around) a city's CBD and capacity investments are chosen by a local (resp. regional) government, through a majority voting process. While tax exporting motives and the imperfect coordination among the two governments may lead to higher overall charges than in the case of a single government, strong preferences for driving across the population can still bring to an equilibiurm with suboptimal total charges.
    Keywords: traffic congestion policy; cordon tolls; parking; voting; fiscal competition;
    JEL: H77 D78 H23 L98
    Date: 2010–11–06
  11. By: Schaffer, Axel; Simar, Léopold; Rauland, Jan
    Abstract: Applying an outlier robust extension of the data envelopment analysis (DEA) followed by a geoadditive regression analysis, this study identifies and decomposes the efficiency of 439 German regions in using infrastructure and human capital. The findings show that the regions' efficiency is driven by a spatial and a non-spatial, arguably structural factor. As a consequence, concrete regional funding schemes, shaped by best practice results, might not be appropriate for all regions. Instead, a more differentiated funding scheme that accounts for both spatial and structural factors seems more promising. --
    Keywords: outlier robust DEA,regional efficiency,geoadditive regression
    JEL: C14 R12 R15
    Date: 2010
  12. By: Forslid, Rikard (Dept. of Economics, Stockholm University); Okubo, Toshihiro (Kobe University)
    Abstract: The present paper focuses on sorting as a mechanism behind the well-established fact that there is a central region productivity premium. Using a model of heterogeneous firms that can move between regions, Baldwin and Okubo (2006) show how more productive firms sort themselves to the large core region. We extend this model by introducing different capital intensities among firms and sectors. In accordance with empirical evidence, more productive firms are assumed to be more capital intensive. As a result, our model can produce sorting to the large regions from both ends of the productivity distribution. Firms with high capital intensity and high productivity as well as firms with very low productivity and low capital intensity tend to relocate to the core. We use region and sector productivity distributions from Japanese micro data to test the predictions of the model. Several sectors show patterns consistent with two-sided sorting, and roughly an equal number of sectors seem to primarily be driven by sorting and selection. We also find supportive evidence for our model prediction that two-sided sorting occurs in sectors with a high capital intensity.
    Keywords: Agglomeration; firm heterogeneity; productivity; spatial sorting
    JEL: F12 F15 F21 R12
    Date: 2010–11–04
  13. By: Pyddoke, Roger (VTI); Andersson, Matts (WSP)
    Abstract: Simulations of net cost contracts augmented with a subsidy per passenger for public transport bus operators in Sweden indicate that such contracts may shift the operators profit maximising price and frequency combination in a direction that yields an increased patronage. The calculations suggest that a subsidised increase in patronage is welfare improving. The simulations unfortunately also indicate that such contracts may become very costly for the public transport authority. In a system with franchised contracts we however suggest that a large part of these costs may be recovered as a bid for the contract. In this study we can not calculate all the potential adaptations that the operator may undertake to optimise the supply. We therefore conjecture that a net cost contract augmented with a subsidy may well be a reasonable policy to achieve increased patronage.
    Keywords: incentive contract; public transport; patronage; subsidy
    JEL: L14 R48
    Date: 2010–11–03
  14. By: SAHA, AMRITA
    Abstract: The Urban Cooperative Banks catering to the needs of the people of the weaker sections in the urban areas are a powerful means of financial empowerment and financial inclusion. Urban Cooperative Banking is based on the twin model of Banking & Cooperation. In spite of immense heterogeneity in assets, operation area, nature of operation; UCBs have immense potential to tackle externalities that inhibit smooth credit flow at a local level.I have undertaken a Case Study on UCBs in Karnataka. It is based on first-hand qualitative and quantitative data from the UCBs, secondary data from RBI Offsite Surveillance System, Bank’s Balance Sheets & RBI Inspection reports. A survey of the selected UCBs in June 2009 yielded meaningful insights.
    Keywords: Urban Cooperative Banks
    JEL: G21
    Date: 2010–06–30
  15. By: Gouzhary, Izhar; Margarian, Anne
    Abstract: Food production and food processing, nowadays, are economic activities in which local and global strategies are interconnected. Moreover the importance of the food industry in total manufacturing is growing; local production systems are competing on the global market by producing specific quality goods or products. Many local regions have attempted to improve their economic situation by encouraging the growth of manufacturing activities. The basic objective of this study to determine and analyze the patterns of food manufacturing and the spatial changes between 2007 and 2001 in the 439 regions in Germany.
    Keywords: Spatial analysis, Food, Germany., Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,
    Date: 2010–10–27
  16. By: Jin, W L; Wang, Bruce
    Abstract: The connectivity of vehicular ad hoc networks (VANets) can be affected by the special distribution patterns, usually dependent and non-uniform, of vehicles in a transportation network. In this study, we introduce a new framework for computing the connectivity in a VANet for continuous distribution patterns of communication nodes on a line in a transportation network. Such distribution patterns can be estimated from traffic densities obtained through loop detectors or other detectors. When communication nodes follow homogeneous Poisson distributions, we obtain a new closed-form solution to connectivity; when distribution patterns of communication nodes are given by spatial renewal processes, we derive an approximate closedform solution to the connectivity; and when communication nodes follow non-homogeneous Poisson distributions, we propose a recursive model of connectivity. For a shock-wave traffic, we demonstrate the consistency between analytical results with those simulated with ns-2, acommunication simulator. With the developed models, we also discuss the impacts on connectivity of road-side stations and different distribution patterns of vehicles. Given continuous traffic conditions, the connectivity model could be helpful for designing routing protocols in VANets and implementing vehicle-infrastructure integration systems. Limitations and future research related to this study are discussed in the conclusion section.
    Keywords: Vehicular ad hoc networks, Inter-vehicle communications, Instantaneous connectivity
    Date: 2010–08–01
  17. By: Jonasson, Erik (Department of Economics, Lund University)
    Abstract: This paper analyses the role of government effectiveness and social norms in the determination of informal employment. A theoretical model is developed, in which local governance affects worker productivity and in which non-compliance with local social norms constitutes a non-pecuniary cost to the worker. These effects, together with skill level, are assumed to influence the decision of the worker whether to seek employment in the formal or informal sector. The model is assessed empirically using data from Brazil, where almost half of the urban labour force is employed informally. The empirical analysis supports the predictions of the model and suggests that informal employment is lower in regions with better governance, stronger social norms for compliance with tax and labour regulation, and higher average education.
    Keywords: informal employment; government effectiveness; social norms; Brazil; Latin America
    JEL: J21 J24 O17 R23
    Date: 2010–10–26
  18. By: Zarnekow, Nana; Henning, Christian H.C.A
    Abstract: This paper focuses on networks as determinants of rural migration and the importance of networks in a rural development perspective. Furthermore the impact of public goods and amenities on migration decisions in rural regions is investigated. Special attention is paid on heterogeneity in peoples migration-decisive components. Data base is a non-farm household-survey of four rural communities in Poland. The estimations show that migration decisions are influenceable in different ways: Social networks as well as socio-economic components and the regional public-good endowment are important drivers of migration, but the direction and amount of influence depends on individual-preferences and on individual network-structures - among other things especially on the network-localization.
    Keywords: Migration, rural development, social networks, latent class model, Community/Rural/Urban Development, R23, D83, H41,
    Date: 2010–08
  19. By: Miriam Beblow (Berlin School of Economics and Law (HWR)); Sven Schreiber (Macroeconomic Policy Institute (IMK) in the Hans Boeckler Foundation)
    Abstract: According to the life-cycle theory of consumption and saving, foreseeable retirement events should not reduce consumption. Whereas some consumption expenditures may fall when they are self-produced (given higher leisure after retirement), this argument applies especially to housing consumption which can hardly be substituted by home production. We test this hypothesis using micro data for Germany (GSOEP) and find that income reductions when entering retirement have a negative effect on housing expenditures for tenants. For some econometric specifications, this effect is significantly stronger than the one of income changes at other times. While this result suggests that the strict consumption-smoothing hypothesis is violated for the subgroup of nonhome owners, the effect is quantitatively small, which explains the ambiguity of previous findings.
    Keywords: consumption smoothing, retirement-consumption puzzle, GSOEP
    JEL: C33 D91
    Date: 2010
  20. By: Guerra, Erick; Cervero, Robert
    Abstract: The cost of building rail transit facilities in the United States has skyrocketed in recent decades. Sections of Los Angeles’s Red Line subway cost more than $750 million per mile to build and even less pricey light-rail systems can cost more than $200 million per mile. Soaring capital investment costs are today’s biggest deterrent, both political and financial, to constructing new transit infrastructure. It stands to reason that high-cost transit projects need high ridership levels. Without sufficient numbers of riders and the fares they generate, new rail investments will inevitably incur huge deficits. Nor will environmental benefits accrue. Transit only reduces traffic congestion and tailpipe emissions when it draws former motorists – and particularly single-occupant drivers – to trains and buses. A system with few riders and a high price tag is a poor investment compared to a system with many riders and a low price tag. Through the investigation of more than 50 transit investment projects built in the U.S. since 1970, we find a strong correspondence between costs and ridership. As one would expect, capital costs and ridership are positively correlated. Moreover, both ridership and capital costs typically rise with job and population densities. By clustering trip ends near stops, concentrated development tends to average far more transit trips per square mile than less concentrated development. But density often increases construction costs as well – via increased costs for right-of-way acquisitions and building demolitions, more complicated route alignments, utility relocation expenses, and higher labor costs. This symbiotic relationship between density and both ridership and costs begs the question: are there densities that offer the most “bang for the buck†in terms of the number of riders for the investment costs? If so, what minimum densities should municipalities zone for around existing or planned stations in different settings or for different types of investments? These are among the most frequently asked questions in the urban planning field today – questions for which there are surprisingly few good answers or widely accepted benchmarks. This paper aims to help fill this knowledge gap.
    Keywords: fixed guideway transit, capital cost, ridership, transit-supportive density
    Date: 2010–08–01
  21. By: Pal, Sarmistha (Brunel University); Roy, Jaideep (University of Birmingham)
    Abstract: Does fiscal decentralization in a politically decentralized less developed country help strengthen democratic institutions at the grass root level? And is the impact of such decentralization on local politics important in determining local development? Our study on Indonesia suggests that fiscal decentralization enhanced free and fair local elections, though the incidence of elite capture, and the consequent breakdown of local democracy, was also present in significant proportions. Fiscal decentralization promoted development mostly in communities which transited out from elite capture to embrace free and fair elections. This was followed by communities that experienced the emergence of elite capture. Communities that continued to remain under either elite capture or free and fair elections did the worst. These findings suggest that while the emergence of elite capture exists, it may not necessarily be the most harmful. Instead, and surprisingly so, stability of local polity hurts development the most.
    Keywords: local politics, less developed nation, decentralization
    JEL: D72 H77 O18
    Date: 2010–10
  22. By: Christian Helmers
    Abstract: This paper investigates the effect of market entry of new firms on incumbent firms'innovative activity measured as patent applications. The basic assumption is that the effect ofentry varies by geographical distance between entrants and incumbents due to the presence oflocalized unobserved spillovers. In order to avoid endogeneity problems commonlyassociated with the timing of entry and entrants' location choice, I analyze entry induced bythe establishment of university business incubators, which are usefully exogenous in time andspace. The results show that entry has a statistically and economically significantly positivestrategic effect on incumbent patenting which is attenuated by the geographical distancebetween entrant and incumbent.
    Keywords: Patents, market entry, incubators, spillover
    JEL: L22 L26 O34
    Date: 2010–09
  23. By: Joseph J. Capuno (School of Economics, University of the Philippines Diliman)
    Abstract: This study investigates the importance of leadership as a driver of local government innovations. Based on a survey of 209 innovations introduced in selected 48 local governments in the Philippines during the period June 2004-June 2008, the observable qualities and possible incentives of incumbent mayors are linked empirically with their reported number of innovations. The Poisson regression results show that the statistically relevant incumbentÂ’s characteristics are age, educational attainment, and experience in the public sector, re-election status and terms in office, controlling for other factors. Also, the fiscal capacity of the local government and the poverty status of the local population are found statistically significant. However, all these factors vary in relative importance across types of innovations. Several policy inputs are suggested to hone the leadership qualities of incumbent mayors for greater adoption of innovations.
    Keywords: Spatial development, land values, convergence, Philippines
    Date: 2010–11
  24. By: Claire Crawford (Institute for Fiscal Studies, 7 Ridgmount Street, London, WC1E 7AE; Institute of Education, University of London, 20 Bedford Way, London WC1H 0AL, UK.); Anna Vignoles (Department of Quantitative Social Science, Institute of Education, University of London. 20 Bedford Way, London WC1H 0AL, UK.)
    Abstract: One in five children in England are recorded as having some kind of special educational need, meaning that they receive additional help in school; yet there is very little evidence of the effect of such assistance on pupil’s academic progress. This is at least partly because it is usually very difficult to define an appropriate control group for pupils with special educational needs. To overcome this issue, we make use of extremely rich data from the Avon Longitudinal Study of Parents and Children to assess the academic progress of pupils between Key Stages 1 and 2 (ages 7 and 11). Specifically, we compare the progress of children who have been formally identified by the SEN system as having non-statemented (less severe) needs with the progress of children who do not have SEN label, but whose class teacher reports that they exhibit behaviour which suggests that they might have special educational needs. Our results suggest that, despite our very similar control group, pupils with a SEN label still score about 0.3 standard deviations lower at Key Stage 2 than otherwise identical pupils without a SEN label. This is perhaps not an entirely unexpected result, given that there is no compulsion in the system for non-statemented SEN funding to be spent on children with special educational needs and in any case additional resources may not close the gap completely. Nonetheless, such a result clearly has significant policy implications: schools are provided with resources to help children with special educational needs and if these resources are not improving academic outcomes for these children, then this should be of concern to both parents and policymakers alike.
    Keywords: special educational needs, educational attainment, propensity score matching
    JEL: I2 H52
    Date: 2010–11–03
  25. By: Brummer, Bernhard; Von Cramon-Taubadel, Stephan; Nivievskyi, Oleg; Schlather, Martin
    Abstract: Even after more than 15 years of transition from plan to market, agriculture in Ukraine still faces many challenges in terms of its structure. The evidence in the literature points to significant heterogeneity of technical efficiency and productivity scores in Ukraine. Moreover, both the recently approved WTO accession, and the ongoing negotiations on a free trade agreement with the EU will require further improvements in productivity and competitiveness at the farm level. Using farm-level data for 2004-2005, we study the presence and possible causes of agglomeration economies in Ukrainian dairy sector. One of the most important results is that there are agglomeration effects in the sector. The performance of dairy farms is influenced by the performance of its neighbors. Furthermore, the dairy farms in the neighborhood of a dairy processor outperform the more distant ones, although the heterogeneity of this effect is substantial.
    Keywords: Ukraine, dairy farming, order-m frontier, spatial dependence, agglomeration., Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,
    Date: 2010–10–27
  26. By: Anania, Giovanni; Nistico, R
    Abstract: â Price dispersion, i.e. a homogeneous product sold at different prices by different sellers, is among the most replicated findings in empirical economics. The paper assesses the extent and determinants of spatial price dispersion for 14 perfectly homogeneous food products in more than 400 retailers in a market characterized by the persistence of a large number of relatively small traditional food stores, side by side with large supermarkets. The extent of observed price dispersion is quite high, suggesting that, despite their large number, monopolistic competition prevails among sellers as a result of the heterogeneity of services offered. When prices in an urban area (where the spatial concentration of sellers is much higher and consumer search costs significantly lower) have been compared with those in smaller towns and rural areas, differences in search costs and the potentially higher degree of competition did not yield lower prices; quite the contrary, they were, on average, higher for 11 of the 14 products considered. Supermarkets proved to be often, but not always, less expensive than traditional retailers, although average savings associated to food shopping at supermarkets were extremely low. Finally, the results of the study suggest that sellers behave differently in their pricing decision strategies; these differences emerge both at the firm level and, for supermarkets, within the same chain. The fact that products considered were homogeneous, purchases frequently repeated, the number of sellers large, and search costs relatively low, did not suffice to keep price dispersion low. Based on the results presented in the paper, it is clear that more important in explaining price dispersion is the contemporaneous heterogeneity of retailers (in terms of services rendered) and consumers (in terms of their propensity to search and shopping preferences), which makes it possible for a monopolistic competition structure of the market to emerge and for small traditional food retail stores to remain in business.
    Keywords: Price dispersion, retail pricing, food markets., Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,
    Date: 2010–10–27
  27. By: Pal, Sarmistha (Brunel University)
    Abstract: Culture as reflected in social and religious norms may be pivotal to social organization in a decentralised economy where local authorities are responsible for the provision of local public goods. We distinguish between individualist and collectivist cultures to argue that collectivist culture may promote rules to indulge in family, social and religious values at the cost of individual values promoting material objects and may thus result in inefficient choice of pubic goods. We use Indonesia as a case in point to classify communities strictly adhering to traditional adat laws and Islamic religion as promoting collectivist culture. Results using 1997 and 2007 Indonesian Family Life Survey community-level panel data highlight that, even after controlling for other variables, traditional collectivist communities strongly adhering to adat and Islam tend to have significantly greater access to social (rather than physical) infrastructural goods; similar pattern is reflected in the allocation of community spending to these goods.
    Keywords: decentralization, collectivist culture, adat law, Islam, social and physical infrastructure, allocation of spending, community development, Indonesia
    JEL: D02 H41 O43 P51
    Date: 2010–10
  28. By: Jesus Gonzalez-Feliu (LET - Laboratoire d'économie des transports - CNRS : UMR5593 - Université Lumière - Lyon II - Ecole Nationale des Travaux Publics de l'Etat); Joelle Morana (LET - Laboratoire d'économie des transports - CNRS : UMR5593 - Université Lumière - Lyon II - Ecole Nationale des Travaux Publics de l'Etat)
    Abstract: Urban logistics is a field that studies the best solutions for urban freight distribution with high environmental objectives. However, most actions are started by public authorities without taking into account the impacts of the new organizational schemas in the existing distribution enterprises' organization. This paper sets out to show that urban logistics approaches are currently important with reference to the noise and pollution in city center. To this end, we present the success experience of Cityporto (Padoua) in Italy. Cityporto is a service which makes deliveries in city centre by using GPL and electric lorries. So, the service is considered as less polluting as a conventional approach. In this context, it allows a delivery at any time of the day, also in the Limited Traffic Zone which is closed at certain hours of the day. This is based on the findings from an exploratory qualitative approach. Documentary analysis several interviews have be made. These concern three internal stakeholders of Interporto di Padova (the company which manages the intermodal platform of Padova, in charge of Cityporto) and one member of Padova's Municipality (which promote the project). The results of this case study show that environmental aspect is one of the foundations of the project, but the economic continuity has to be first ensured. Indeed, the preservation of this service on the long term is subjected to its solvency. Moreover, its success is associated to the recognition by employees, and also customers. With regard to the collected information, it is possible to propose a balanced scorecard, where three axes emerged in connexion with economic, environmental and social dimensions. The paper makes a contribution to the evaluation and measurement of city urban logistics using a success story that has been developed from the practitioner perspective. This experience could provide a basis for further practices in Italy and other European countries. In conclusion, the proposed case study is presented for its academic, policy and managerial implications. This experience conceptualises city logistics in relation with the Sustainable Development, setting the main objectives and steps of urban planning for freight distribution and logistics issues. But above all, it provides an understanding of the key success factors in a green transport organisation which can become a pivotal position in the upstream supply chain. De facto, the study should facilitate the implementation of green urban logistics taking into account the importance of the project's economic continuity.
    Keywords: City logistics, sustainability, case study, qualitative research, management
    Date: 2010–08–03
  29. By: HernandezâVillafuerte, Karla
    Abstract: The objectives of this research are to investigate the influence of geographical distance on the cointegration relationship in order to increase knowledge on the issue, and to indentify its role in Brazilian agricultural markets. With this intention, the cointegration framework is applied allowing for the presence of multiple structural breaks in the long run equation. The inclusion of breaks is in response to the multiple changes of the agricultural system during the period of investigation. The spatial integration is calculated between each market pair. The cointegration coefficient and geographical distance relationship is calculated by means of an OLS regression, taking into account the quality of roads and the proximity to a border or port. The effect of the distance depends on the product. In the case of rice markets, there is a weak, negative and significant relation. Concerning soybeans, the relationship is not significant. After allowing for the inclusion of breaks in the long run, the results remain unvaried. In addition, the region and a better access to export points are the main variables in the definition of the prices.
    Keywords: cointegration, price transmission, geographical distance, structural breaks, rice, soybeans, Brazil., Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,
    Date: 2010–10–27
  30. By: Dimitrios P. Louzis (Bank of Greece and Athens University of Economics and Business); Aggelos T. Vouldis (Bank of Greece and University of Athens); Vasilios L. Metaxas (Bank of Greece)
    Abstract: This paper uses dynamic panel data methods to examine the determinants of non-performing loans (NPLs) in the Greek banking sector, separately for each type of loan (consumer, business and mortgage loans). The study is motivated by the hypothesis that both macroeconomic and bank-specific variables have an effect on loan quality and that these effects vary between different categories of loans. The results show that NPLs in the Greek banking system can be explained mainly by macrofundamentals (GDP, unemployment, interest rates) and management quality. Differences in the quantitative impact of macroeconomic factors among types of loans are evident with non-performing mortgages being the least responsive towards changes in the macroeconomic conditions.
    Keywords: Non-perfoming loans; Greek banking system; Macroeconomic determinants; Bank specific determinants; Dynamic panel data
    JEL: G21 C23
    Date: 2010–09
  31. By: Boarnet, Marlon G.; Ferguson, Gavin; Edwards, R D; Princevac, Marko; Bartolome, Christian; Pan, Hansheng
    Abstract: This paper provides preliminary evidence that the placement of buildings influences the concentration of fine particulates by altering wind flow. The authors collected measurements of fine particulate concentration, wind speed, wind direction, and traffic levels around five Southern California arterials selected to represent a range of building densities. In some cases the difference in average concentrations between opposite sides of the street was on the order of 10 μg/m3. In most cases the concentration was higher on the upwind side of the street, where the wind wakes of buildings limit the dispersion of particulates. Although this work is exploratory in nature, it reveals that fine particulate concentrations can vary even within a single city block, a scale finer than those used in current policy models. Given the trend towards infill development and densification in many places, this is an important topic that warrants further research to more fully understand the influence of the built environment on air quality.
    Date: 2010–08–01
  32. By: Barrera-Osorio, Felipe; Raju, Dhushyanth
    Abstract: Low student learning is a common finding in much of the developing world. This paper uses a relatively unique dataset of five semiannual rounds of standardized test data to characterize and explain the short-term changes in student learning. The data are collected as part of the quality assurance system for a public-private partnership program that offers public subsidies conditional on minimum learning levels to low-cost private schools in Pakistan. Apart from a large positive distributional shift in learning between the first two test rounds, the learning distributions over test rounds show little progress. Schools are ejected from the program if they fail to achieve a minimum pass rate in the test in two consecutive attempts, making the test high stakes. Sharp regression discontinuity estimates show that the threat of program exit on schools that barely failed the test for the first time induces large learning gains. The large change in learning between the first two test rounds is likely attributable to this accountability pressure given that a large share of new program entrants failed in the first test round. Schools also qualify for substantial annual teacher bonuses if they achieve a minimum score in a composite measure of student test participation and mean test score. Sharp regression discontinuity estimates do not show that the prospect of future teacher bonus rewards induces learning gains for schools that barely did not qualify for the bonus.
    Keywords: Tertiary Education,Education For All,Secondary Education,Teaching and Learning,Primary Education
    Date: 2010–11–01
  33. By: Coulter, Rory (University of St. Andrews); van Ham, Maarten (University of St. Andrews); Feijten, Peteke (University of St. Andrews)
    Abstract: Many theories of residential mobility contend that individuals express a sequence of moving desires, intentions and expectations prior to moving. Much research has investigated how individuals form these pre-move thoughts, with a largely separate literature examining actual mobility. Only a few studies have attempted to link pre-move thoughts to subsequent actual moves, but these often do not explicitly distinguish between different types and combinations of pre-move thoughts. Using 1998-2006 British Household Panel Survey (BHPS) data, this study is the first to investigate whether moving desires and expectations are empirically distinct pre-move thoughts. Using multinomial regression models we demonstrate that moving desires and expectations have different meanings, and often occur in combination: the factors associated with expecting to move differ depending upon whether the move is also desired (and vice versa). Next, using panel logistic regression models, we show that different desire-expectation combinations have different effects on the probability of subsequent moving behaviour.
    Keywords: residential mobility, moving desires, moving expectations, satisfaction, longitudinal data
    JEL: J61 R21 R23
    Date: 2010–10
  34. By: Hoffmann, J.
    Abstract: This paper deals with the identification of spatial agglomerations in the German food processing industry, using the Cluster Index developed by Sternberg and Litzenberger. Previous studies have analyzed this industry as one of several others utilizing highly aggregated data. The results of these studies mostly indicate a lack of agglomerations for the German food industry. Given the very heterogeneous character of this branch, an analysis at such an aggregated level might provide flawed results. Therefore, the following study analyzes German industry sectors for the first time at a highly disaggregated spatial (429 districts) and sectoral (23 subsectors of food processing industry) level. Results show that spatial agglomerations exist for several subsectors. This holds especially for processing and preserving of meat, fish, fruit, wine and milk processing as well as for breweries and the processing of mineral water.
    Keywords: Regional Cluster, Spatial Economics, German Food Processing Industry, Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,
    Date: 2010–10–27
  35. By: Sharon Belenzon; Mark Schankerman
    Abstract: Using new data on citations to university patents and scientific publications, and measures ofdistance based on Google maps, we study how geography affects university knowledgediffusion. We show that knowledge flows from patents are localized in two respects: theydecline sharply with distance up to about 100 miles, and they are strongly constrained bystate borders, controlling for distance. While distance also constrains knowledge spilloversfrom publications, the state border does not. We investigate how the strength of the stateborder effect varies with university and state characteristics. It is larger for patents frompublic, as compared to private, universities and this is partly explained by the localdevelopment policies of universities. The border effect is larger in states with stronger noncompetelaws that affect intra-state labor mobility, and those with greater reliance on in-stateeducated scientists and engineers. We confirm the impact of non-compete statutes bystudying a policy reform in Michigan that introduced such restrictions.
    Keywords: knowledge spillovers, diffusion, geography, university technology transfer,patents, scientific publications
    JEL: K41 L24 O31 O34
    Date: 2010–09
  36. By: Philomena M. Bacon (University of East Anglia); Peter Moffatt (School of Economics, University of East Anglia)
    Abstract: Microdata from the UK Survey of Mortgage Lenders is used to model borrowers’ choices between variable and fixed rate mortgages. The data is treated as a large-scale “natural experiment” on risky choice, with the choice of a fixed rate corresponding to the “safe choice” in a more conventional experimental setting. The choice is assumed to depend partly on risk attitude, and partly on expectations of future movements in interest rates. Approximately 280,000 choices, made by borrowers between 1992 and 2001, appear in the sample. The ordered probit model is used for estimation, while taking account of a number of econometric issues including missing counterfactuals, selectivity, and endogeneity. Explanatory variables are divided into three groups: mortgage price variables; interest rate expectations; and borrower characteristics. A large number of strong effects are found, including: fixing is more likely when agents expect interest rates to increase; the presence of female borrowers increases the propensity to fix; older borrowers are less likely to fix; high-income borrowers are less likely to fix, particularly so if income is “self-certified”; those with higher loan-to-value ratios are less likely to fix. These findings amount to new insights in the modelling of choice under risk.Series: AEP UEA Working Papers in Economics
    Keywords: risky choice, fixed and variable rate mortgages, counterfactuals, interest rate expectations; ordered probit.
    JEL: G20 M13
    Date: 2010–11–01
  37. By: Scott E. Carrell; Mark Hoekstra; James E. West
    Abstract: The increase in obesity over the past thirty years has led researchers to investigate the role of social networks as a contributing factor. However, several challenges make it difficult to demonstrate a causal link between friends’ physical fitness and own fitness using observational data. To overcome these problems, we exploit data from a unique setting in which individuals are randomly assigned to peer groups. We find statistically significant peer effects that are 40 to 70 percent as large as the own effect of prior fitness scores on current fitness outcomes. Evidence suggests that the effects are caused primarily by friends who were the least fit, thus supporting the provocative notion that poor physical fitness spreads on a person-to-person basis.
    JEL: I18 I2 Z13
    Date: 2010–11
  38. By: Lorenzo Cappellari (DISCE, Università Cattolica); Konstantinos Tatsiramos (Institute for the Study of Labor Bonn)
    Abstract: We investigate the effect of social interactions on labor market outcomes using a direct measure of social contacts based on information about individuals’ three best friends and their characteristics. We examine the effect of the number of employed friends on the transition from non-employment to employment, and we find the existence of significant network effects at the individual level. An additional employed friend increases the probability of finding a job by 3.7 percentage points. This finding is robust to specifications that address the endogeneity of friends’ employment status, which may be induced by correlation with unobserved individual attributes and feedback effects. Considering labor market outcomes, we find evidence of higher wages and employment stability for those with more employed friends, which is consistent with networks acting as an information transmission mechanism.
    Keywords: Networks, Unemployment, Friendship ties.
    JEL: J64
    Date: 2010–10
  39. By: Philip J. Cook; Jens Ludwig
    Abstract: This paper is the introductory chapter for the forthcoming NBER volume Controlling Crime: Strategies and Tradeoffs. The Great Recession has led to cuts in criminal justice expenditures, and the trend towards ever-higher incarceration rates that has been underway since the 1970s in the U.S. appears to have turned the corner. That raises the question of whether the crime drop can be sustained. State and local revenue shortfalls have engendered intense interest in cost-cutting measures that do not sacrifice public safety. We argue that there is some reason for optimism, simply because current criminal justice allocations and policies appear to be inefficient – more crime control could be accomplished with fewer resources. The crime problem is often framed as a debate between those who favor a “tough” punitive approach versus those who favor a “soft” approach that focuses on prevention or remediation programs. But the canonical economic model of crime from Becker (1968) suggests that the decision to commit crime involves a weighing of both benefits and costs, implying that both tough and soft approaches might be useful. It is ultimately an empirical question about how the marginal crime-control dollar may be most effectively deployed. The evidence presented in this edited volume suggests that a more efficient portfolio of crime-control strategies would involve greater attention to enhancing the certainty rather than the severity of punishment for criminal behavior, stimulating private-sector cooperation for controlling crime, and making strategic investments in the human capital of at-risk populations, including in particular efforts to improve the social-cognitive skills of justice-system-involved populations. To help illustrate the magnitude of the inefficiencies within the current system, the essay concludes with a thought experiment that considers how much additional crime-prevention could be obtained by reverting average sentence lengths back to 1984 levels (midway through the Reagan era) and redirecting the freed-up resources (on the order of $12 billion annually) to alternative uses.
    JEL: K42
    Date: 2010–11
  40. By: Veneri, Paolo; Burgalassi, David
    Abstract: Polycentric development is a widely-used term both in academic research and in the normative agenda. However, its theoretical foundations and economic implications are still unknown and the concept of polycentricity still does not have a shared definition, or a shared measurement method. The aim of this paper is twofold. Firstly polycentricity is defined and measured at a NUTS 2 regional level, by comparing functional and morphological methods. Secondly, in the light of the role assigned to polycentric development in terms of policy, the paper investigates the relationships between the degree of regional polycentricity and the key economic variables of performance – namely competitiveness, social cohesion and environmental sustainability. The main finding was that functional and morphological methods led to similar results. In addition, a correlation was found between polycentricity and a more unequal income distribution and a higher level of productivity, especially when polycentricity was measured in functional terms. No stable correlations were found between polycentricity and measures of environmental sustainability, such as land consumption and greenhouse emissions.
    Keywords: Polycentric development; Italian regions; Rank size distribution; Ordinary polycentricity.
    JEL: R12 R11 R14
    Date: 2010–10

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