Luigi Buzzacchi, Antonio De Marco, Marcello Pagnini
This article offers new evidence on agglomeration economies by examining the link between total factor productivity (TFP) and employment density in Italy. We investigate whether and how the TFP–density nexus contributes to explaining a relevant share of the marked productivity gap between the northern and the southern Italian regions. We estimate TFP for a large sample of manufacturing firms and then aggregate it at the level of local labour market areas. We tackle the endogeneity issues stemming from the presence of omitted covariates and reverse causation with an innovative set of diagnostic tests and an instrumental variable approach that relies on geological and historical data. Our estimate of the TFP elasticity to the spatial concentration of economic activities is about 0.045, a magnitude comparable to those measured for other developed countries. We also show that no significant heterogeneity emerges in the intensity of agglomeration economies across the country and that the positive TFP difference in favour of the firms located in the North is not due to the tougher competition taking place in those areas.
{"title":"Agglomeration and the Italian North–South divide","authors":"Luigi Buzzacchi, Antonio De Marco, Marcello Pagnini","doi":"10.1093/jeg/lbae025","DOIUrl":"https://doi.org/10.1093/jeg/lbae025","url":null,"abstract":"This article offers new evidence on agglomeration economies by examining the link between total factor productivity (TFP) and employment density in Italy. We investigate whether and how the TFP–density nexus contributes to explaining a relevant share of the marked productivity gap between the northern and the southern Italian regions. We estimate TFP for a large sample of manufacturing firms and then aggregate it at the level of local labour market areas. We tackle the endogeneity issues stemming from the presence of omitted covariates and reverse causation with an innovative set of diagnostic tests and an instrumental variable approach that relies on geological and historical data. Our estimate of the TFP elasticity to the spatial concentration of economic activities is about 0.045, a magnitude comparable to those measured for other developed countries. We also show that no significant heterogeneity emerges in the intensity of agglomeration economies across the country and that the positive TFP difference in favour of the firms located in the North is not due to the tougher competition taking place in those areas.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"41 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-08-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141910371","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Aidong Zhao, Huub Ploegmakers, Jan Rouwendal, Xianlei Ma
This article analyzes the role of production factor land in the production process. Using a novel dataset of 20,205 newly established firms in the Chinese manufacturing sector from 2007 to 2014, our production function estimates suggest the existence of a sizable gap (averaging 50 USD/m2) between the marginal productivity of land and its user cost. Basic economic theory suggests a possible relationship with China’s minimum investment intensity (MII) regulation. An analysis using changes in MII limits over time and the resulting discontinuities at county borders confirms that larger gaps are significantly associated with increases in MII limits. Thus, the results of this study suggest that MII regulation leads to allocative inefficiency of land.
{"title":"Land investment regulation and allocative efficiency: evidence from the Chinese manufacturing sector","authors":"Aidong Zhao, Huub Ploegmakers, Jan Rouwendal, Xianlei Ma","doi":"10.1093/jeg/lbae024","DOIUrl":"https://doi.org/10.1093/jeg/lbae024","url":null,"abstract":"This article analyzes the role of production factor land in the production process. Using a novel dataset of 20,205 newly established firms in the Chinese manufacturing sector from 2007 to 2014, our production function estimates suggest the existence of a sizable gap (averaging 50 USD/m2) between the marginal productivity of land and its user cost. Basic economic theory suggests a possible relationship with China’s minimum investment intensity (MII) regulation. An analysis using changes in MII limits over time and the resulting discontinuities at county borders confirms that larger gaps are significantly associated with increases in MII limits. Thus, the results of this study suggest that MII regulation leads to allocative inefficiency of land.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"15 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141877373","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Between 2010 and 2019, the global number of forcibly displaced individuals doubled, prompting countries to sign migration deals. Under these agreements, transit or origin countries halt migrants in exchange for support. The 2017 Italy–Libya deal outsourced search and rescue operations in the Central Mediterranean to the Libyan Coast Guard (LCG), aiming to stop migrants from reaching Italy. Using a spatial difference-in-differences design, we find an increase in the probability of observing a deadly incident in areas patrolled by the LCG post-deal. Descriptive evidence suggests a shift in routes, diverting a significant portion of migration to the Western Mediterranean Route.
{"title":"Externalizing rescue operations at sea: The migration deal between Italy and Libya","authors":"Diego Zambiasi, Emanuele Albarosa","doi":"10.1093/jeg/lbae022","DOIUrl":"https://doi.org/10.1093/jeg/lbae022","url":null,"abstract":"Between 2010 and 2019, the global number of forcibly displaced individuals doubled, prompting countries to sign migration deals. Under these agreements, transit or origin countries halt migrants in exchange for support. The 2017 Italy–Libya deal outsourced search and rescue operations in the Central Mediterranean to the Libyan Coast Guard (LCG), aiming to stop migrants from reaching Italy. Using a spatial difference-in-differences design, we find an increase in the probability of observing a deadly incident in areas patrolled by the LCG post-deal. Descriptive evidence suggests a shift in routes, diverting a significant portion of migration to the Western Mediterranean Route.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"78 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-07-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141725902","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article investigates the interplay between scientific and technological capabilities in regional technological diversification dynamics by looking at the contributions of academic inventors. Combining the evolutionary economic approach and the theories on regional innovation capabilities on the one hand, and the distinctive features of academic inventors and university–industry patenting on the other, we hypothesize that the participation of university-based inventors to local patenting activity positively influences the chance of regional technological diversification and mitigates the path dependency engendered by the constraining role of the technological relatedness. In addition, we hypothesize that academic inventors tend to push regional technological trajectories towards their portfolio of specializations, hence allowing a process of technological convergence. The empirical results highlight the key role of academic institutions in the development of new regional technological trajectories while contributing to the academic and policy debate on regional diversification strategies.
{"title":"The contribution of academic inventors to regional technological diversification: the Italian evidence","authors":"Francesco Quatraro, Alessandra Scandura","doi":"10.1093/jeg/lbae021","DOIUrl":"https://doi.org/10.1093/jeg/lbae021","url":null,"abstract":"This article investigates the interplay between scientific and technological capabilities in regional technological diversification dynamics by looking at the contributions of academic inventors. Combining the evolutionary economic approach and the theories on regional innovation capabilities on the one hand, and the distinctive features of academic inventors and university–industry patenting on the other, we hypothesize that the participation of university-based inventors to local patenting activity positively influences the chance of regional technological diversification and mitigates the path dependency engendered by the constraining role of the technological relatedness. In addition, we hypothesize that academic inventors tend to push regional technological trajectories towards their portfolio of specializations, hence allowing a process of technological convergence. The empirical results highlight the key role of academic institutions in the development of new regional technological trajectories while contributing to the academic and policy debate on regional diversification strategies.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"38 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-07-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141602700","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Agglomeration externalities are the key factor explaining the existence of cities and their size. However, while the various micro foundations of agglomeration externalities stress the importance of total factor productivity (TFP), the empirical evidence on agglomeration externalities rests on measures obtained using firm revenue or value-added as a measure of firm output: revenue-based TFP (TFP-R). This article uses data on French manufacturing firms’ revenue, quantity, and prices to estimate TFP and TFP-R and decompose the latter into various elements. Our analysis suggests that the revenue productivity advantage of denser areas is mainly driven by higher prices charged rather than differences in TFP. At the same time, firms in denser areas are able to sell higher quantities and generate higher revenues, despite higher prices. These and other results we document suggest that firms in denser areas are able to charge higher prices because they sell higher demand/quality products. In this respect, two key elements related to this capacity to sell more at higher prices are the degree of vertical differentiation and trade cost, with products characterized by higher vertical differentiation and/or lower trade costs featuring stronger patterns and driving overall results.
{"title":"On the productivity advantage of cities","authors":"Nick Jacob, Giordano Mion","doi":"10.1093/jeg/lbae020","DOIUrl":"https://doi.org/10.1093/jeg/lbae020","url":null,"abstract":"Agglomeration externalities are the key factor explaining the existence of cities and their size. However, while the various micro foundations of agglomeration externalities stress the importance of total factor productivity (TFP), the empirical evidence on agglomeration externalities rests on measures obtained using firm revenue or value-added as a measure of firm output: revenue-based TFP (TFP-R). This article uses data on French manufacturing firms’ revenue, quantity, and prices to estimate TFP and TFP-R and decompose the latter into various elements. Our analysis suggests that the revenue productivity advantage of denser areas is mainly driven by higher prices charged rather than differences in TFP. At the same time, firms in denser areas are able to sell higher quantities and generate higher revenues, despite higher prices. These and other results we document suggest that firms in denser areas are able to charge higher prices because they sell higher demand/quality products. In this respect, two key elements related to this capacity to sell more at higher prices are the degree of vertical differentiation and trade cost, with products characterized by higher vertical differentiation and/or lower trade costs featuring stronger patterns and driving overall results.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"28 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-06-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141448449","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Anthonin Levelu, Anna Maria Mayda, Gianluca Orefice
An increasing number of regional trade agreements contains provisions that ease access to visas among member countries, which reduces the administrative cost of crossing the border. Combining United Nations data on bilateral stocks of immigrants in the period 1990–2020 with World Bank data on the content of 279 regional trade agreements, this article presents robust evidence of a positive effect of visa provisions in regional trade agreements on bilateral migration: the presence of visa provisions in regional trade agreements increases the bilateral stock of immigrants by 5.8 per cent. This result is robust to an instrumental variable strategy addressing the endogeneity problem. The effect of the inclusion of visa provisions in regional trade agreements is particularly effective among country pairs with different income levels (such as North-South). For this type of country pairs, the presence of visa provisions in regional trade agreements increases the bilateral stock of immigrants by 12.7 per cent. Finally, the article shows that the effectiveness of visa provisions in regional trade agreements reduces with the anti-immigration sentiment of voters in the destination.
{"title":"Deep trade agreements and international migration: the role of visa provisions","authors":"Anthonin Levelu, Anna Maria Mayda, Gianluca Orefice","doi":"10.1093/jeg/lbae014","DOIUrl":"https://doi.org/10.1093/jeg/lbae014","url":null,"abstract":"An increasing number of regional trade agreements contains provisions that ease access to visas among member countries, which reduces the administrative cost of crossing the border. Combining United Nations data on bilateral stocks of immigrants in the period 1990–2020 with World Bank data on the content of 279 regional trade agreements, this article presents robust evidence of a positive effect of visa provisions in regional trade agreements on bilateral migration: the presence of visa provisions in regional trade agreements increases the bilateral stock of immigrants by 5.8 per cent. This result is robust to an instrumental variable strategy addressing the endogeneity problem. The effect of the inclusion of visa provisions in regional trade agreements is particularly effective among country pairs with different income levels (such as North-South). For this type of country pairs, the presence of visa provisions in regional trade agreements increases the bilateral stock of immigrants by 12.7 per cent. Finally, the article shows that the effectiveness of visa provisions in regional trade agreements reduces with the anti-immigration sentiment of voters in the destination.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"15 Suppl 4 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-05-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141085486","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We analyze the externalities arising from a bilateral asylum policy—the list of safe origin countries—relying on a tractable model. Using self-collected monthly data, we estimate that including one origin country on the safe list of a given destination decreases asylum applications from that origin to that destination by 29 per cent. We use a counterfactual policy simulation to quantify the spillover effects occurring across origin and destination countries. Individuals from targeted origin countries move to alternative destinations. Individuals from untargeted origins divert from alternative destinations. The magnitude of the externalities depends on the size of the affected flows.
{"title":"The externalities of immigration policies on migration flows: the case of an asylum policy","authors":"Lucas Guichard, Joël Machado","doi":"10.1093/jeg/lbae016","DOIUrl":"https://doi.org/10.1093/jeg/lbae016","url":null,"abstract":"We analyze the externalities arising from a bilateral asylum policy—the list of safe origin countries—relying on a tractable model. Using self-collected monthly data, we estimate that including one origin country on the safe list of a given destination decreases asylum applications from that origin to that destination by 29 per cent. We use a counterfactual policy simulation to quantify the spillover effects occurring across origin and destination countries. Individuals from targeted origin countries move to alternative destinations. Individuals from untargeted origins divert from alternative destinations. The magnitude of the externalities depends on the size of the affected flows.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"1 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-05-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140910618","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We argue that trans-local knowledge connections positively impact local epistemic inventor communities in global cities, using patent citations as an indicator of global knowledge connectivity. Patented inventions have become more concentrated in the most internationally connected global cities, increasing inter-regional inequality. We identify two dimensions of knowledge connectivity: the compatibility of connections between similar profiles of technological knowledge, and the geographical diversity of knowledge connections between differently specialized global cities. We suggest that interaction between local and international inventor epistemic communities is now a vital driver of local innovation in global cities, and interregional inequality between these and other cities.
{"title":"International knowledge connectivity and the increasing concentration of innovation in major global cities","authors":"John Cantwell, Salma Zaman","doi":"10.1093/jeg/lbae013","DOIUrl":"https://doi.org/10.1093/jeg/lbae013","url":null,"abstract":"We argue that trans-local knowledge connections positively impact local epistemic inventor communities in global cities, using patent citations as an indicator of global knowledge connectivity. Patented inventions have become more concentrated in the most internationally connected global cities, increasing inter-regional inequality. We identify two dimensions of knowledge connectivity: the compatibility of connections between similar profiles of technological knowledge, and the geographical diversity of knowledge connections between differently specialized global cities. We suggest that interaction between local and international inventor epistemic communities is now a vital driver of local innovation in global cities, and interregional inequality between these and other cities.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"11 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-05-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140903018","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Drawing on financial geography literature and the concept of state rescaling, this article investigates the state–finance nexus with an emphasis on state spatial reconfiguration. Through a historically and geographically informed political economic analysis, it argues that China’s state-led, market-oriented rural banking reforms are not merely the outcome of a deepening market logic within the financial administration of the rural sector. They are also crucial for state spatial reconfiguration to address uneven rural and urban development. The article calls for greater sensitivity towards relational spatiotemporality and uneven development to comprehend fully the spatiality of the state–finance nexus.
{"title":"Reworking uneven geographical development: the spatial logic of China’s rural banking reforms","authors":"Leqian Yu, Jie Yin","doi":"10.1093/jeg/lbae012","DOIUrl":"https://doi.org/10.1093/jeg/lbae012","url":null,"abstract":"Drawing on financial geography literature and the concept of state rescaling, this article investigates the state–finance nexus with an emphasis on state spatial reconfiguration. Through a historically and geographically informed political economic analysis, it argues that China’s state-led, market-oriented rural banking reforms are not merely the outcome of a deepening market logic within the financial administration of the rural sector. They are also crucial for state spatial reconfiguration to address uneven rural and urban development. The article calls for greater sensitivity towards relational spatiotemporality and uneven development to comprehend fully the spatiality of the state–finance nexus.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"17 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-05-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140826356","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article combines unconditional quantile regressions with difference-in-differences to study the distributive effects of a foreign buyer tax (FBT) on home prices in New South Wales (NSW). The main results reveal that the FBT reduces house prices in NSW but only among the more expensive houses located in desirable neighborhoods of Sydney and with a relatively high share of foreign-born population. We find evidence that the FBT reduces transaction volumes in the same expensive Sydney neighborhoods and immigrant enclaves where house prices are observed to decline, in support of a direct mechanism that the FBT curbs foreign demand. Additional results suggest that more expensive homes are not substituted with less expensive housing, and that some foreign buyers respond to the FBT by divesting away from NSW locations. The main policy implication is that the FBT may help deter foreign buyers from accumulating higher-priced and luxury assets, but may fail to address broader housing affordability concerns facing the local population.
{"title":"Heterogeneous effects of a foreign buyer tax on house prices in New South Wales","authors":"Anthony Howell, Siân Mughan, Akheil Singla","doi":"10.1093/jeg/lbae007","DOIUrl":"https://doi.org/10.1093/jeg/lbae007","url":null,"abstract":"This article combines unconditional quantile regressions with difference-in-differences to study the distributive effects of a foreign buyer tax (FBT) on home prices in New South Wales (NSW). The main results reveal that the FBT reduces house prices in NSW but only among the more expensive houses located in desirable neighborhoods of Sydney and with a relatively high share of foreign-born population. We find evidence that the FBT reduces transaction volumes in the same expensive Sydney neighborhoods and immigrant enclaves where house prices are observed to decline, in support of a direct mechanism that the FBT curbs foreign demand. Additional results suggest that more expensive homes are not substituted with less expensive housing, and that some foreign buyers respond to the FBT by divesting away from NSW locations. The main policy implication is that the FBT may help deter foreign buyers from accumulating higher-priced and luxury assets, but may fail to address broader housing affordability concerns facing the local population.","PeriodicalId":48251,"journal":{"name":"Journal of Economic Geography","volume":"18 1","pages":""},"PeriodicalIF":2.9,"publicationDate":"2024-04-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140343141","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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