Pub Date : 2025-10-24DOI: 10.1016/j.pirs.2025.100125
Sandy Dall'erba , André Chagas , William Ridley , Yilan Xu , Lilin Yuan
The difference-in-difference (DID) framework is now a well-accepted method in quasi-experimental research. However, DID does not consider treatment-induced changes to a network linking treated and control units. The endogenous network DID methodology we offer here (ENDID) controls for the direct and indirect role of the treatment on any network member. In addition, we control for the sensitivity of the network to the treatment and its endogeneity on the outcome variable. Monte Carlo simulations and a three-step process combining a gravity model with a 2SLS estimation demonstrate the performance of our new estimator. We apply it to the case where drought impacts global wheat trade and, in turn, wheat production. The results show that a DID that disregards the network and its changes leads to significant underestimates of overall treatment effects.
{"title":"Difference-in-differences with endogenous externalities: Model and application to climate econometrics","authors":"Sandy Dall'erba , André Chagas , William Ridley , Yilan Xu , Lilin Yuan","doi":"10.1016/j.pirs.2025.100125","DOIUrl":"10.1016/j.pirs.2025.100125","url":null,"abstract":"<div><div>The difference-in-difference (DID) framework is now a well-accepted method in quasi-experimental research. However, DID does not consider treatment-induced changes to a network linking treated and control units. The endogenous network DID methodology we offer here (ENDID) controls for the direct and indirect role of the treatment on any network member. In addition, we control for the sensitivity of the network to the treatment and its endogeneity on the outcome variable. Monte Carlo simulations and a three-step process combining a gravity model with a 2SLS estimation demonstrate the performance of our new estimator. We apply it to the case where drought impacts global wheat trade and, in turn, wheat production. The results show that a DID that disregards the network and its changes leads to significant underestimates of overall treatment effects.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 6","pages":"Article 100125"},"PeriodicalIF":2.3,"publicationDate":"2025-10-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145467269","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-16DOI: 10.1016/j.pirs.2025.100122
Carmen María Llorca-Rodríguez , Amalia Cristina Casas-Jurado , Rosa María García-Fernández , Jorge Chica-Olmo
Concern about income distribution has spread worldwide owing to its connections with social unrest and conflict. For this reason, the European Union (EU) pays special attention to its Cohesion Policy, thus fulfilling its commitment to equity and ensuring its own economic, social and political sustainability. This paper aims to assess the impact of tourism on income inequality and polarization with a view to guiding income distribution policies, particularly the EU Cohesion Policy. Specifically, we control for spatial dependence to determine the impact of tourism both in destinations and their neighbouring regions. We also consider non-linear relationships to detect possible changes over time in the effects of tourism on income distribution. Additionally, we contrast inbound and domestic tourism since the characteristics of these flows can have differential effects on the results. Dynamic Spatio-temporal estimations are applied to EU NUTS-1 data using spatial lag of X (SLX) models. Our estimations indicate that total tourism hinders income distribution in destinations showing an inverted-U-shaped relationship with income inequality and polarization. We find that inequality and polarization increase with inbound tourism but decrease with domestic tourism. Moreover, the two typologies improve income distribution in regions neighbouring tourism destinations. Both types of tourism cause direct, indirect and induced effects of different intensity. Policy actions applicable to other geographical contexts are proposed targeting the tourism supply structure, labour market regulation and structural competitiveness jointly with measures to effectively manage the transition to a knowledge-based economy and strengthen social protection systems, particularly in education, health, unemployment and retirement.
{"title":"Dynamic spatio-temporal modelling of tourism impact on income inequality and polarization: Inbound and domestic flows in the EU","authors":"Carmen María Llorca-Rodríguez , Amalia Cristina Casas-Jurado , Rosa María García-Fernández , Jorge Chica-Olmo","doi":"10.1016/j.pirs.2025.100122","DOIUrl":"10.1016/j.pirs.2025.100122","url":null,"abstract":"<div><div>Concern about income distribution has spread worldwide owing to its connections with social unrest and conflict. For this reason, the European Union (EU) pays special attention to its Cohesion Policy, thus fulfilling its commitment to equity and ensuring its own economic, social and political sustainability. This paper aims to assess the impact of tourism on income inequality and polarization with a view to guiding income distribution policies, particularly the EU Cohesion Policy. Specifically, we control for spatial dependence to determine the impact of tourism both in destinations and their neighbouring regions. We also consider non-linear relationships to detect possible changes over time in the effects of tourism on income distribution. Additionally, we contrast inbound and domestic tourism since the characteristics of these flows can have differential effects on the results. Dynamic Spatio-temporal estimations are applied to EU NUTS-1 data using spatial lag of X (SLX) models. Our estimations indicate that total tourism hinders income distribution in destinations showing an inverted-U-shaped relationship with income inequality and polarization. We find that inequality and polarization increase with inbound tourism but decrease with domestic tourism. Moreover, the two typologies improve income distribution in regions neighbouring tourism destinations. Both types of tourism cause direct, indirect and induced effects of different intensity. Policy actions applicable to other geographical contexts are proposed targeting the tourism supply structure, labour market regulation and structural competitiveness jointly with measures to effectively manage the transition to a knowledge-based economy and strengthen social protection systems, particularly in education, health, unemployment and retirement.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 6","pages":"Article 100122"},"PeriodicalIF":2.3,"publicationDate":"2025-10-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145417074","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-14DOI: 10.1016/j.pirs.2025.100121
Uwe Neumann , Christoph M. Schmidt
Inspired by the literature on social polarisation and residential segregation we draw on a probabilistic approach to pursue the evolution of household location preferences. Using microdata from the German Socio-Economic Panel (SOEP) for the period 1984–2020 we demonstrate that structural economic change was accompanied by an increasing preference for residence in compact housing close to urban centres. Our analysis outlines that during the past two decades, intra-urban and urban-rural disparities by age and skills have begun to rise. Even for Germany, where segregation is moderate, any scenario suggesting neighbourhood-level convergence of living standards seems unlikely.
{"title":"The dynamics of household location preferences in Germany","authors":"Uwe Neumann , Christoph M. Schmidt","doi":"10.1016/j.pirs.2025.100121","DOIUrl":"10.1016/j.pirs.2025.100121","url":null,"abstract":"<div><div>Inspired by the literature on social polarisation and residential segregation we draw on a probabilistic approach to pursue the evolution of household location preferences. Using microdata from the German Socio-Economic Panel (SOEP) for the period 1984–2020 we demonstrate that structural economic change was accompanied by an increasing preference for residence in compact housing close to urban centres. Our analysis outlines that during the past two decades, intra-urban and urban-rural disparities by age and skills have begun to rise. Even for Germany, where segregation is moderate, any scenario suggesting neighbourhood-level convergence of living standards seems unlikely.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 6","pages":"Article 100121"},"PeriodicalIF":2.3,"publicationDate":"2025-10-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145417075","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-02DOI: 10.1016/j.pirs.2025.100120
Gustavo Henrique Leite de Castro , Carlos Roberto Azzoni
This paper examines the conditional convergence of cognitive, social, and motor skills among manufacturing occupations in Brazil from 2003 to 2019. Using a spatial panel econometric approach, we analyze whether less industrialized regions are catching up in terms of workforce sophistication and how spatial spillovers influence this process. The study introduces a skill-based framework that moves beyond traditional education-based human capital measures, incorporating an index that captures occupational skill complexity. Our results indicate evidence of conditional skill convergence, with social skills exhibiting the fastest convergence rate, followed by cognitive and motor skills. Spatial spillover effects are significant, reinforcing the role of geographic proximity in skill development dynamics. These findings contribute to understanding how industrial labor markets evolve in developing economies and provide relevant information for regional policy design aimed at reducing skill disparities.
{"title":"Skills and regional dynamics","authors":"Gustavo Henrique Leite de Castro , Carlos Roberto Azzoni","doi":"10.1016/j.pirs.2025.100120","DOIUrl":"10.1016/j.pirs.2025.100120","url":null,"abstract":"<div><div>This paper examines the conditional convergence of cognitive, social, and motor skills among manufacturing occupations in Brazil from 2003 to 2019. Using a spatial panel econometric approach, we analyze whether less industrialized regions are catching up in terms of workforce sophistication and how spatial spillovers influence this process. The study introduces a skill-based framework that moves beyond traditional education-based human capital measures, incorporating an index that captures occupational skill complexity. Our results indicate evidence of conditional skill convergence, with social skills exhibiting the fastest convergence rate, followed by cognitive and motor skills. Spatial spillover effects are significant, reinforcing the role of geographic proximity in skill development dynamics. These findings contribute to understanding how industrial labor markets evolve in developing economies and provide relevant information for regional policy design aimed at reducing skill disparities.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 6","pages":"Article 100120"},"PeriodicalIF":2.3,"publicationDate":"2025-10-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145269402","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-25DOI: 10.1016/j.pirs.2025.100117
Jesús López-Rodríguez , Diego Martínez-López , Brais Pociña-Sánchez
In the foot-loose capital (FC) models, it is predicted that agglomeration forces create rents for the mobile factor (capital), which can be easily taxed, and therefore higher equilibrium tax rates are expected. In this paper, a highly flexible econometric specification (P-Spline spatial autoregressive model, PS-SAR) is used to examine the relationship between tax rates and agglomeration economies in Spain over the period 2013–2020. The existence of a minimum level of agglomeration economies required for taxable agglomeration rents, in a context of non-linearities, is found. A reassessment of the linear FC models is therefore necessary in order to disentangle the mechanisms that might lead to this fact.
{"title":"Threshold effects of agglomeration on local business taxation: Evidence from Spain","authors":"Jesús López-Rodríguez , Diego Martínez-López , Brais Pociña-Sánchez","doi":"10.1016/j.pirs.2025.100117","DOIUrl":"10.1016/j.pirs.2025.100117","url":null,"abstract":"<div><div>In the foot-loose capital (FC) models, it is predicted that agglomeration forces create rents for the mobile factor (capital), which can be easily taxed, and therefore higher equilibrium tax rates are expected. In this paper, a highly flexible econometric specification (P-Spline spatial autoregressive model, PS-SAR) is used to examine the relationship between tax rates and agglomeration economies in Spain over the period 2013–2020. The existence of a minimum level of agglomeration economies required for taxable agglomeration rents, in a context of non-linearities, is found. A reassessment of the linear FC models is therefore necessary in order to disentangle the mechanisms that might lead to this fact.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 6","pages":"Article 100117"},"PeriodicalIF":2.3,"publicationDate":"2025-09-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145222195","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-16DOI: 10.1016/j.pirs.2025.100118
Andrea Caragliu , Chiara F. Del Bo
The digital divide represents one of the many facets of socio-economic inequalities, creating a wedge between citizens with the means and ability to reap the benefits related to modern information and communication technologies (ICTs) and those who lack these resources and skills. Among its determinants at the individual and more aggregate level, space-specific factors, including the quality of regional institutions, may affect its geographical breakdown. In this paper we exploit data covering 181 European cities for the period 2008–2017, examining the spatial distribution of the within-city digital divide and how this relates to several local characteristics. In particular, we focus on the interplay between geographic variables and institutional quality at the local level, measured with the University of Gothenburg’s Quality of Governance dataset. Within-city digital divide is computed using individual-level data on European citizens, thus controlling for individual traits that the literature has identified as relevant determinants. These include gender, age, education level, and occupational information, among others. Our paper sheds light both on the individual level determinants of the within-city digital divide, and considers how the uneven spatial distribution of the urban digital divide is related to local institutional, economic and social characteristics. Implications of our work can help inform local policy makers, who increasingly rely on digital solutions in urban policy planning, to consider the existence of a local digital divide among citizens and adopt corrective measures to help achieve digital urban policies’ full potential. Our empirical results document a negative association between the quality of local institutions and the within-city digital divide. Results are robust to a number of alternative specifications, as well as to the use of historical instruments.
{"title":"Regional institutions and the urban digital divide","authors":"Andrea Caragliu , Chiara F. Del Bo","doi":"10.1016/j.pirs.2025.100118","DOIUrl":"10.1016/j.pirs.2025.100118","url":null,"abstract":"<div><div>The digital divide represents one of the many facets of socio-economic inequalities, creating a wedge between citizens with the means and ability to reap the benefits related to modern information and communication technologies (ICTs) and those who lack these resources and skills. Among its determinants at the individual and more aggregate level, space-specific factors, including the quality of regional institutions, may affect its geographical breakdown. In this paper we exploit data covering 181 European cities for the period 2008–2017, examining the spatial distribution of the within-city digital divide and how this relates to several local characteristics. In particular, we focus on the interplay between geographic variables and institutional quality at the local level, measured with the University of Gothenburg’s Quality of Governance dataset. Within-city digital divide is computed using individual-level data on European citizens, thus controlling for individual traits that the literature has identified as relevant determinants. These include gender, age, education level, and occupational information, among others. Our paper sheds light both on the individual level determinants of the within-city digital divide, and considers how the uneven spatial distribution of the urban digital divide is related to local institutional, economic and social characteristics. Implications of our work can help inform local policy makers, who increasingly rely on digital solutions in urban policy planning, to consider the existence of a local digital divide among citizens and adopt corrective measures to help achieve digital urban policies’ full potential. Our empirical results document a negative association between the quality of local institutions and the within-city digital divide. Results are robust to a number of alternative specifications, as well as to the use of historical instruments.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 6","pages":"Article 100118"},"PeriodicalIF":2.3,"publicationDate":"2025-09-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145109877","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-12DOI: 10.1016/j.pirs.2025.100116
Seulki Kim , Euijune Kim
The evolution toward more interconnected urban networks underscores the significance of spatial configuration in regional resilience. This study leverages the 2008 global financial crisis as a quasi-experimental context to examine how spatial structures shape the economic resilience of OECD regions to recessionary shocks. The results reveal that regions with cores exhibit higher resilience than those without. Among core regions, single-core regions outperform non-core regions, while multi-core regions demonstrate even stronger resilience. Notably, clustered-core regions—where multiple urban centers are spatially proximate—further enhance resilience by leveraging synergy effects through spatial interactions with neighboring resilient regions. Additionally, patterns of industrial diversity underscore the complementary yet asymmetric roles of related and unrelated variety. Unrelated variety drives substantial resilience gains by promoting structural independence, whereas related variety offers steady but moderate support by fostering sectoral interconnectedness and knowledge diffusion. These findings highlight that spatial integration beyond administrative boundaries can effectively foster cross-regional synergies.
{"title":"The role of spatial structures in shaping regional economic resilience: Evidence from OECD regions based on urban core configurations","authors":"Seulki Kim , Euijune Kim","doi":"10.1016/j.pirs.2025.100116","DOIUrl":"10.1016/j.pirs.2025.100116","url":null,"abstract":"<div><div>The evolution toward more interconnected urban networks underscores the significance of spatial configuration in regional resilience. This study leverages the 2008 global financial crisis as a quasi-experimental context to examine how spatial structures shape the economic resilience of OECD regions to recessionary shocks. The results reveal that regions with cores exhibit higher resilience than those without. Among core regions, single-core regions outperform non-core regions, while multi-core regions demonstrate even stronger resilience. Notably, clustered-core regions—where multiple urban centers are spatially proximate—further enhance resilience by leveraging synergy effects through spatial interactions with neighboring resilient regions. Additionally, patterns of industrial diversity underscore the complementary yet asymmetric roles of related and unrelated variety. Unrelated variety drives substantial resilience gains by promoting structural independence, whereas related variety offers steady but moderate support by fostering sectoral interconnectedness and knowledge diffusion. These findings highlight that spatial integration beyond administrative boundaries can effectively foster cross-regional synergies.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 6","pages":"Article 100116"},"PeriodicalIF":2.3,"publicationDate":"2025-09-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145100068","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-10DOI: 10.1016/j.pirs.2025.100114
Tatsuya Kusumi
Distance is a primary deterrent to welfare-improving migration, yet less is known about how this deterrent effect varies across individuals. This study investigates gender differences in the distance dependence of internal migration. Analyzing rich, individual-level panel data from Japan with a multinomial choice model, we find a significant gender difference: women are less deterred by distance than men, ceteris paribus. This result, which stands in stark contrast to observations from aggregate data, is uncovered only after using microdata to control for the confounding effects of socioeconomic attributes such as education and employment. Our findings challenge common assumptions about migration patterns and suggest that population-attraction policies may need to be gender-specific.
{"title":"Gender differences in distance dependence of internal migration","authors":"Tatsuya Kusumi","doi":"10.1016/j.pirs.2025.100114","DOIUrl":"10.1016/j.pirs.2025.100114","url":null,"abstract":"<div><div>Distance is a primary deterrent to welfare-improving migration, yet less is known about how this deterrent effect varies across individuals. This study investigates gender differences in the distance dependence of internal migration. Analyzing rich, individual-level panel data from Japan with a multinomial choice model, we find a significant gender difference: women are less deterred by distance than men, ceteris paribus. This result, which stands in stark contrast to observations from aggregate data, is uncovered only after using microdata to control for the confounding effects of socioeconomic attributes such as education and employment. Our findings challenge common assumptions about migration patterns and suggest that population-attraction policies may need to be gender-specific.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 5","pages":"Article 100114"},"PeriodicalIF":2.3,"publicationDate":"2025-09-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145049680","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-08-30DOI: 10.1016/j.pirs.2025.100115
Andrea Ascani , Luca Bettarelli , Laura Resmini
Combining economic geography and international business literature on Multinational Enterprises (MNEs), we explore knowledge dissemination patterns within and across NUTS-3 regions. Our results, based on Italy, indicate that external knowledge collected by MNEs through their network of subsidiaries abroad is positively associated with the innovative output of the regions of origin of MNEs. Moreover, its diffusion over space occurs through two intra-firm mechanisms: one involving MNEs and their domestic affiliates, and the other involving indigenous firms co-located with MNEs and owning other firms in different regions. The intensity of these mechanisms strongly depends on the technological space in which firms operate.
{"title":"Unpacking the black box of knowledge externalities: intra-MNE networks vs. spatial spillovers","authors":"Andrea Ascani , Luca Bettarelli , Laura Resmini","doi":"10.1016/j.pirs.2025.100115","DOIUrl":"10.1016/j.pirs.2025.100115","url":null,"abstract":"<div><div>Combining economic geography and international business literature on Multinational Enterprises (MNEs), we explore knowledge dissemination patterns within and across NUTS-3 regions. Our results, based on Italy, indicate that external knowledge collected by MNEs through their network of subsidiaries abroad is positively associated with the innovative output of the regions of origin of MNEs. Moreover, its diffusion over space occurs through two intra-firm mechanisms: one involving MNEs and their domestic affiliates, and the other involving indigenous firms co-located with MNEs and owning other firms in different regions. The intensity of these mechanisms strongly depends on the technological space in which firms operate.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 5","pages":"Article 100115"},"PeriodicalIF":2.3,"publicationDate":"2025-08-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144988991","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-08-28DOI: 10.1016/j.pirs.2025.100113
Giuseppe Pernagallo , Giampaolo Vitali
The causal relationship between living in a peripheral area and real estate investment decisions is currently unexplored in empirical literature. Using survey data on 2711 Italian respondents collected between 2022 and 2023, we show that living in a peripheral area has a negative impact on the probability of having invested or investing in real estate in the future. OLS estimates suggest that being in a peripheral area reduces the likelihood of having invested in real estate in the last 24 months by about 3–4 percent and the likelihood of investing in real estate in the next 24 months by about 4–6 percent. These results are robust, having tried different models (OLS, probit, bivariate probit, and rare events logistic regression), different control variables, and also an instrumental variable approach to control for the potential endogeneity of homeownership. In this regard, our work introduces a new instrument to tackle the endogeneity problem of homeownership: hereditary motivation to purchase a home. The instrument has all the necessary characteristics to address this problem, such as a very strong first stage. Finally, we adopt a new machine learning algorithm, ABESS, to show the importance of including residence in a peripheral area as an explanatory variable and to select the best subset. This approach could also be exploited in further real estate and regional studies.
{"title":"Housing market investment in peripheral areas: Evidence from Italy","authors":"Giuseppe Pernagallo , Giampaolo Vitali","doi":"10.1016/j.pirs.2025.100113","DOIUrl":"10.1016/j.pirs.2025.100113","url":null,"abstract":"<div><div>The causal relationship between living in a peripheral area and real estate investment decisions is currently unexplored in empirical literature. Using survey data on 2711 Italian respondents collected between 2022 and 2023, we show that living in a peripheral area has a negative impact on the probability of having invested or investing in real estate in the future. OLS estimates suggest that being in a peripheral area reduces the likelihood of having invested in real estate in the last 24 months by about 3–4 percent and the likelihood of investing in real estate in the next 24 months by about 4–6 percent. These results are robust, having tried different models (OLS, probit, bivariate probit, and rare events logistic regression), different control variables, and also an instrumental variable approach to control for the potential endogeneity of homeownership. In this regard, our work introduces a new instrument to tackle the endogeneity problem of homeownership: hereditary motivation to purchase a home. The instrument has all the necessary characteristics to address this problem, such as a very strong first stage. Finally, we adopt a new machine learning algorithm, ABESS, to show the importance of including residence in a peripheral area as an explanatory variable and to select the best subset. This approach could also be exploited in further real estate and regional studies.</div></div>","PeriodicalId":51458,"journal":{"name":"Papers in Regional Science","volume":"104 5","pages":"Article 100113"},"PeriodicalIF":2.3,"publicationDate":"2025-08-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145010855","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
扫码关注我们
求助内容：
应助结果提醒方式：
京公网安备 11010802042870号