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on Economic Geography |
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Issue of 2024‒10‒28
five papers chosen by Andreas Koch, Institut für Angewandte Wirtschaftsforschung |
| By: | Hanna Adam (University of Bayreuth); Mario Larch (University of Bayreuth. CEPII, CESifo, ifo Institute, GEP); Jordi Paniagua (University of Valencia. Kellogg Institute, University of Notre Dame) |
| Abstract: | We quantify the economic impact of a potential secession of Catalonia from Spain. Using a novel dataset of trade flows between 17 Spanish sub-national regions and 142 countries, we estimate the effects of different levels of borders on trade flows and uncover heterogeneity in regional, national, and EU border effects. We use a general equilibrium analysis of trade with fiscal transfers to understand the consequences of a potential secession with political uncertainty. In counterfactual experiments, we impose new borders on Catalan regional and international trade, potentially within or outside the EU, resulting in a welfare decline for Catalonia and Spain. |
| Keywords: | international trade, regional trade, border effects, regional independence |
| JEL: | F10 F13 F14 H77 R12 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:eec:wpaper:2409 |
| By: | John Gibson (University of Waikato); Bonggeun Kim (Seoul National University); Chao Li (University of Auckland) |
| Abstract: | We examine relationships between luminosity and local economic growth for counties in China and the US and districts in Indonesia. Many authors estimate treatment effects on local luminosity growth and transfer GDP-luminosity elasticities from elsewhere to calculate economic growth effects. Our insight is that these GDP-luminosity elasticities vary especially by spatial scale and metro status, and also by period and remote sensing source. The elasticities mainly capture extensive margins of luminosity. Measurement errors in popular DMSP data attenuate GDP-luminosity elasticities but aggregation-sensitivity persists even when using instrumental variables estimation. Consequently, claimed growth effects of various treatments may be quite inaccurate. |
| Keywords: | GDP growth; Luminosity; measurement error; treatment effects |
| JEL: | C21 O40 R11 |
| Date: | 2024–10–14 |
| URL: | https://d.repec.org/n?u=RePEc:wai:econwp:24/08 |
| By: | Jahn, Elke Jutta; Janeba, Eckhard; Agrawal, David |
| JEL: | H20 H31 J20 J61 R23 R48 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:vfsc24:302425 |
| By: | Vincenzo Lanzetta; Cristina Ponsiglione |
| Abstract: | The European Union Regional Innovation Scoreboard (EURIS) is currently and broadly used for the definition of regional innovation policies by European policymakers; it is a regional innovation measuring tool for the analysis of each specific innovation indicator, from which it is possible to analyze the overtime evolution of each regional innovation indicator; according to the importance of the European Union Regional Innovation Scoreboard for innovation policy purposes, we state that European regional policymakers need integrative and synergistic methodological tools, with respect to the EURIS one, for innovation policy purposes. Thus, we highlight the need to integrate the current methodology of the European Regional Innovation Scoreboard with a Factorial K-means (FKM) tool for clustering purposes, and with a neural network (NN) tool for performing what-if policy analyses. We claim that our proposed FKM-NN tool could be used, by regional innovation policymakers, as a very effective synergistic instrument of the European Union Regional Innovation Scoreboard. |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2409.13316 |
| By: | Maximiliano Dvorkin; Brian Greaney |
| Abstract: | The spatial distribution of wealth in the United States is very heterogeneous, with important differences within and across US states. We study the distribution of wealth in a country and how it is shaped by the characteristics earnings across regions, and by the frictions individuals face to move and reallocate across space. For this, we develop a tractable model of consumption, savings, and location choice with many regions, incomplete markets, and heterogeneous agents facing persistent and transitory income shocks. Our analysis focuses on the role of income shocks, precautionary savings, mobility, and sorting in shaping the geographic distribution of income and wealth over time. Our theory extends the workhorse macroeconomic model of consumption and savings under uncertainty and risk to an economy with multiple labor markets and costly mobility. Despite the complex spatial and individual heterogeneity, we can characterize the optimal consumption, savings, and mobility decisions of workers in closed form. Mobility frictions increase precautionary savings as workers hedge against sharp fluctuations in consumption generated by their mobility decisions. The spatial distribution of wealth is primarily driven by the interaction between persistent income shocks, saving behavior, and worker sorting across locations. The results highlight the importance of accounting for worker mobility and regional heterogeneity in earnings dynamics when studying the spatial distribution of wealth. |
| Keywords: | mobility; precautionary savings; spatial equilibrium; wealth; inequality |
| JEL: | R12 R23 E21 J61 F16 |
| Date: | 2024–09–30 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedlwp:98888 |