Tiago Freire, Xi'an Jiaotong - Liverpool University

Steven Brakman, University of Groningen

Harry Garretsen, University of Groningen

Steven Brakman, University of Groningen

Peter van Bergeijk, Erasmus University Rotterdam

Mark Partridge, Ohio State University

Steven Brakman, University of Groningen

Peter A.G. van Bergeijk, International Institute of Social Studies

Michael Storper, London School of Economics

Is the grass greener on the other side of the fence?

Simona Iammarino & Elisabetta Marinelli

London School of Economics, Department of Geography and Environment

Abstract

The ability to attract human capital and the level of satisfaction of the local labour force are increasingly catching the attention of geographers. Indeed understanding the links between migration and job satisfaction can give precious insights, at the micro level, on an important driver of regional development: the concentration of talent. The paper explores this link by analysing the 2001 cohort of Italian graduates and focuses in particular on those coming from the South, the most disadvantaged area of the country. The paper explores how personal characteristics (such as socio-economic background, university performance and other employment features) together with the migration behaviour, impact on job satisfaction with short-term and long-term career outcomes. Methodologically the paper applies generalized ordered logit regressions to a survey on graduates’ entry in the labour market conducted by the Italian National Statistical Institute. We find that leaving the South is a rewarding choice: in both short and long term domains of employment wellbeing, those who left the area are more satisfied than those who stayed, those who moved within the South or those who returned to it after being educated elsewhere. The North-West, in particular, is the area that provides the most fulfilling opportunities and where a large number of graduates concentrate.

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The contribution of cities to economic development: an explanation based on chinese cities

Meine Pieter van Dijk , IHS and Institute of Social Studies in The Hague (ISS) of Erasmus University Rotterdam

Abstract

To understand the contribution of cities to economic development recent data for Chinese cities will be used. we will use the economic contribution of cities measured by their GDP and growth rate, but we also want to explain their competitiveness by doing regression analysis to find the factors contributing to the attractiveness of Chinese cities as measured by the amount of Foreign Direct Investment (FDI) received. Subsequently we want to know are the Chinese cities only booming because of cheap labor, or are they gradually developing into high tech economies, able to generate innovative technology to support their competitiveness? The three topics: the contribution of cities, the explanation of their success and their future competitiveness will lead to some considerations about the importance of economic reform policies at different levels of government and the role of urban and regional managers in this process.

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Border cities and EU integration: A case of diminished transport costs

Steven Brakman^a, Harry Garretsen^a, Charles van Marrewijk^b, and Abdella Oumer^a

^a University of Groningen, Department of Economics

^b Utrecht University School of Economics

Abstract

Distance related variables usually only vary in a cross-section dimension between cities, regions, or countries, but hardly in a time dimension. The enlargement of the EU and the introduction of the euro, however, can be looked upon as two natural experiments that shed light on the consequences of changes in remoteness over time. Central in this paper is the notion that cities or regions close to the former border (abolished through EU integration) are affected the most from these policy changes, whereas the effects for cities and regions further away are more subdued. The reason is that for border cities and regions these (sudden) changes in transaction costs are felt more intensely than cities and regions that are located further from the former border. We find strong support at both the city- and regional level that the EU integration process has been beneficial for border cities. The border integration effect is more important for small regions than for large regions (as expected), but more important for large than for small cities (contrary to expectations).

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The Area and Population of Cities: New Insights from a Different Perspective on Cities

Hernan D. Rozenfeld^a, Diego Rybski^a, Xavier Gabaix^b, and Hernan A. Makse^a

^a City College of New York

^b New York University

Abstract

The distribution of city populations has attracted much attention, in part because it constrains models of local growth. However, there is no consensus on the distribution below the very upper tail, because available data need to rely on “legal” rather than “economic” definitions for medium and small cities. To remedy this difficulty, we construct cities “from the bottom up” by clustering populated areas obtained from high-resolution data. We find that Zipf ’s law for population holds for cities as small as 5,000 inhabitants in Great Britain and 12,000 inhabitants in the USA. We also find a Zipf ’s law for areas.

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History, Institutions and Cities: A View from the Americas

Sukkoo Kim^a and Marc Law^b

^a Washington University in St. Louis and NBER

^b University of Vermont

Abstract

In this paper, we use the familiar strategy of exploiting the quasi-natural experimental distribution of political institutions in the Americas, caused by the European colonial experience, to examine the role of institutions on urban and local development in the Americas. Political institutions, whether unitary or federal and parliamentary or constitutional, matter for urban and local development because they formally and informally define the property rights of federal, regional and local governments. In Latin America, we argue that the centralization of political power in the federal government at the expense of local governments contributed to the rise of urban primacy whereas in North America, political decentralization fostered a more balanced urban and local development. Yet, even between US and Canada, we find that the differences in the levels of political centralization at the state/provincial levels led to important divergences in the organization of cities and local governments between these countries.

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How do regions diversify over time? Industry relatedness and the development of new growth paths in regions

Frank Neffke*, Martin Henning**, and Ron Boschma***

*          Erasmus University Rotterdam, The Netherlands. E-mail: neffke@ese.eur.nl

**        Lund University, Sweden. E-mail: martin@keg.lu.se

***      Utrecht University, The Netherlands. Email: r.boschma@geo.uu.nl

Abstract

The question of how new regional growth paths emerge has been raised by many leading economic geographers. From an evolutionary perspective, there are strong reasons to believe that regions are most likely to branch into industries that are technologically related to the pre-existing industries in that region. By employing a new indicator of technological relatedness between manufacturing industries, we use detailed plant-level data to analyze the economic evolution of 70 Swedish regions during the period of 1969-2002. Our analyses show that the long-term evolution of the economic landscape in Sweden is subject to strong path dependencies. Industries that were technologically related to the pre-existing industries in a region had a higher probability of entering that region in comparison to unrelated industries. Industries that were technologically-unrelated to the pre-existing industries of a region had a higher probability of exiting that region. Moreover, we also found that the industrial profiles of Swedish regions showed a high degree of technological cohesion. Despite substantial structural change, this cohesion was very persistent over time. Our methodology also proved useful when focusing on the economic evolution of one particular region. Our analysis indicates that the Linköping region increased its industrial cohesion over a period of 30 years due to the entry of industries that were closely related to its regional portfolio, and the exit of industries that were technologically peripheral. In summary, we find systematic evidence that the rise and fall of industries is strongly conditioned by industrial relatedness at the regional level.

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Recessionary Shocks and Regional Employment: Evidence on the Resilience of UK Regions

Bernard Fingleton^a, Harry Garretsen^b & Ron Martin^c

^a University of Strathclyde, email: bf100@cam.ac.uk

^b University of Groningen, email: j.h.garretsen@rug.nl

^c University of Cambridge, email: rlm1@cam.ac.uk

Abstract

We analyse the resilience of UK regions to employment shocks. Two basic notions of resilience are distinguished. With engineering resilience, there is an underlying stable growth path to which a regional economy rebounds following a shock. With ecological resilience, shocks can permanently affect the growth path of the regional economy. Our data set consists of quarterly employment series for 12 UK regions (NUTS I) for the period 1971-2010. Using a SUR model specification, we test for the relevance of (engineering) resilience of UK regional employment to the 4 recessionary shocks in our sample. It turns out that UK regions do indeed differ in their resilience, but that these differences mainly concern the initial resistance to shocks and not so much the recovery stage. The SUR model does not allow shocks to have permanent effects and it also does not take the possibility of time differentiated shock spillovers between the 12 regions into account. To this end, we also estimate a VECM specification where employment shocks can have permanent effects and where also inter-regional employment linkages are included. We find that employment shocks typically have permanent effects when it concerns the own region effects. Permanent effects can also be found for the impact on other regions but the inter-regional effects are typically only significant for nearby regions.

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Conference:   Economic Dynamics and Innovation

The world is changing at a rapid pace. New goods and services are invented and distributed across the globe. Innovation and technology changes affect trade flows, investment flows, and how the world is organized. Recent experience has shown that these intricate connections between cities, regions, countries, and continents influences how rapidly shocks are transmitted across the globe, leading to drastic declines in trade flows and production levels. This conference analyzes some of the connections between innovation, technology diffusion, trade interaction, and economic dynamics.

Keynote speakers:

Wolfgang Keller, University of Colorado

A leading international expert on innovation, technology diffusion, and trade connections.

Xavier Gabaix, New York University

A renowned expert, among other things, on the connections between economics and physics (econophysics)

Program:   Economic Dynamics and Innovation

USE research program: Multidisciplinary Economics of Change within Firms, Markets, and Sectors

Local organizors:

Jaap Bos, Utrecht University

Charles van Marrewijk, Utrecht University

Date: 9 November 2009

Location: Utrecht University, Utrecht, The Netherlands

Preliminary program

Chair: Frank van Oort, Netherlands Environmental Assessment Agency

09.45  

Opening by Hans Stoof, Utrecht University

Location: Academiegebouw, Aula

10.00

Keynote speaker:   

Location: Academiegebouw, Aula

Wolfgang Keller, University of Colorado

Technology Transfer of Multinational Firms and the Geography of International Transactions Costs

with Stephen Yeaple; link to related paper: http://www.voxeu.org/index.php?q=node/3276

10.45

Questions and discussion

Location: Academiegebouw, Aula

11.00

Break

Location: Academiegebouw, Maskeradezaal

Chair: Steven Brakman, University of Groningen

11.30

Keynote speaker:

Location: Academiegebouw, Aula

Xavier Gabaix, New York University

The Area and Population of Cities: New Insights from a Different Perspective on Cities

with Hernan Rozenfeld, Diego Rybski, and Hernan Makse

link to paper: http://pages.stern.nyu.edu/~xgabaix/papers/zipfCCA.pdf

12.15

Questions and discussion

Location: Academiegebouw, Aula

12.30

Lunch

Location: Academiegebouw, Maskeradezaal

Chair: Peter van Bergeijk, Erasmus University

Location: Academiegebouw, Belle van Zuylenzaal   

Chair: Harry Garretsen, University of Groningen 

Location: Academiegebouw, Kanunnikenzaal  

13.30

Workshop: Technology and Trade

Jacques Mairesse, Maastricht University 

Are Italian physicists more productive than french physicists? with Michele Pezzoni

Erik Stam, Utrecht University

Decline in high-tech regions: the Cambridge case  

Discussion (with W. Keller)

Location: Academiegebouw, Belle van Zuylenzaal

Workshop: Spatial Interaction

Jeroen Hinloopen, University of Amsterdam

Comparative advantage, the rank-size rule, and the gravity equation

Marc Schramm, Utrecht University

Knowledge spillovers in Hong Kong

Discussion (with X. Gabaix)

Location: Academiegebouw, Kanunnikenzaal

15.45

Break

Location: Maskeradezaal

16.15

Inaugural lecture: Charles van Marrewijk, Utrecht University

Spatial diffusion of technology and the trade collapse

Location: Academiegebouw, Aula

17.15

Drinks

Location: Academiegebouw, Senaatszaal

Wolfgang Keller

The Area and Population of Cities: New Insights from a Different Perspective on Cities

with Hernan Rozenfeld, Diego Rybski, and Hernan Makse; link: http://pages.stern.nyu.edu/~xgabaix/papers/zipfCCA.pdf

Technology Transfer of Multinational Firms and the Geography of International Transactions Costs

with Stephen Yeaple; link to related paper: http://www.voxeu.org/index.php?q=node/3276

Xavier Gabaix

The Area and Population of Cities: New Insights from a Different Perspective on Cities

with Hernan Rozenfeld, Diego Rybski, and Hernan Makse; link: http://pages.stern.nyu.edu/~xgabaix/papers/zipfCCA.pdf

Abstract:
The distribution of the population of cities has attracted a great deal of attention, in part because it sharply constrains models of local growth. However, to this day, there is no consensus on the distribution below the very upper tail, because available data need to rely on the "legal" rather than "economic" definition of cities for medium and small cities. To remedy this difficulty, in this work we construct cities "from the bottom up" by clustering populated areas obtained from high-resolution data. This method allows us to investigate the population and area of cities for urban agglomerations of all sizes. We find that Zipf's law (a power law with exponent close to 1) for population holds for cities as small as 12,000 inhabitants in the USA and 5,000 inhabitants in Great Britain. In addition, we identify a new empirical rule: the distribution of city areas is also close to a Zipf's law. We provide a parsimonious model with endogenous city area that is consistent with those findings.

Jacques Mairesse

Are Italian physicists more productive than french physicists? Prima-facie Evidence on the Importance of Collaboration in Scientific Research

with Michele Pezzoni

Abstract:
In this paper we investigate why the productivity of physicists in terms of publications (numbers and average journal impact factor) appears much higher in Italy than in France. We are thus led to compare separately the productivity of physicists working in universities and in the two main Public Research Organizations (PROs) in the two countries (CNRS and CNR). We also have to abstract from differences in the participation to "big research project" resulting in publications with numerous co-authors. Finally, we analyze the different styles of cooperation between physicists in the two countries. We conclude by some considerations on the importance of collaboration in the productivity of scientific research, and on the ensuing measurement issues of productivity at the individual scientist level.

Comparative advantage, the rank-size rule, and the gravity equation

Abstract:

Using a comprehensive international trade data set we document stylized facts of comparative advantage as measured with the Balassa index. In particular we investigate empirical regularities known as Zipf’s Law or the rank-size rule for the distribution of the interaction between countries as measured by revealed comparative advantage. Using the recently developed estimator by Gabaix and Ibragimov (2007) we find strong evidence in favor of the rank-size rule along the time, country, and sector dimension for three different levels of data aggregation. The estimated Pareto exponents that characterize the distribution of revealed comparative advantage are stable over time but differ across countries and sectors. These differences are related empirically to country and sector characteristics, including population size, GDP, and factor intensities. Next we consider to what extent revealed comparative advantage explains bilateral trade-flows. Preliminary results indicate that the Balassa index adds significantly to the explanatory power of the gravity equation.

Decline in high-tech regions: the Cambridge case

Abstract:

This paper analyses mechanisms of industrial decline and renewal, illustrated with empirical evidence on the Cambridge high-tech region. The paper contributes to ecological (carrying capacity) and evolutionary (path dependence) theories of regional industrial development. It provides a longitudinal, multilevel analysis of invention, firm, and industry dynamics and change in the supply and costs of regional resources in order to explain decline in high-tech regions. While expansion of the Cambridge high-tech region has been sustained over time, recently forces of decline have been stronger than those of renewal. Decline in employment was most marked in the local telecommunications and biotech sectors, while the creation of variety by new firms fell off most strongly in the local IT software & services industry. Increasing diseconomies of agglomeration are in evidence, together with a contraction of finance that may have been a harbinger of financial stringency to come

Steven Brakman, University of Groningen