Trust: The Social Virtues and the Creation of Prosperity

Transactions of the Institute of British Geographers

Frenken K., Van Oort F. and Verburg T. (2007) Related variety, unrelated variety and regional economic growth, Regional Studies 41, 685–697. In economic theory, one can distinguish between variety as a source of regional knowledge spillovers, called Jacobs externalities, and variety as a portfolio protecting a region from external shocks. It is argued that Jacobs externalities are best measured by related variety (within sectors), while the portfolio argument is better captured by unrelated variety (between sectors). A methodology based on entropy measures is introduced to compute related variety and unrelated variety. Using data at the NUTS 3 level in the Netherlands for 1996–2002, it was found that Jacobs externalities enhance employment growth, while unrelated variety dampens unemployment growth. Productivity growth can be explained by traditional determinants including investments and research and development expenditures. Implications for regional policy follow. Frenken K., Van Oort F. et Verburg T. ...

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Related variety, unrelated variety and regional economic growth

Economics and Information Theory

In recent years, economic geographers have seized on the concepts of `path dependence' and `lock-in' as key ingredients in constructing an evolutionary approach to their subject. However, they have tended to invoke these notions without proper examination of the ongoing discussion and debate devoted to them within evolutionary economics and elsewhere. Our aim in this paper, therefore, is, first, to highlight some of the unresolved issues that surround these concepts, and, second, to explore their usefulness for understanding the evolution of the economic landscape and the process of regional development. We argue that in many important aspects, path dependence and `lock-in' are place-dependent processes, and as such require geographical explanation. However, the precise meaning of regional `lock-in', we contend, is unclear, and little is known about why it is that some regional economies become locked into development paths that lose dynamism, whilst other regional economies seem able to avoid this danger and in effect are able to `reinvent' themselves through successive new paths or phases of development. The issue of regional path creation is thus equally important, but has been rarely discussed. We conclude that whilst path dependence is an important feature of the economic landscape, the concept requires further elaboration if it is to function as a core notion in an evolutionary economic geography.

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Path dependence and regional economic evolution

Conventional studies of bilateral trade patterns specify a log-normal gravity equation for empirical estimation. However, the log-normal gravity equation suffers from three problems: the bias created by the logarithmic transformation, the failure of the homoscedasticity assumption, and the way zero values are treated. These problems normally result in biased and inefficient estimates. Recently, the Poisson specification of the trade gravity model has received attention as an alternative to the log-normality assumption (Santos Silva and Tenreyro, 2006). However, the standard Poisson model is vulnerable for problems of overdispersion and excess zero flows. To overcome these problems, this paper considers modified Poisson fixed-effects estimations (negative binomial, zero-inflated). Extending the empirical model put forward by Santos Silva and Tenreyro (2006), we show how these techniques may provide viable alternatives to both the log-normal and standard Poisson specification of the gravity model of trade.

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On the Specification of the Gravity Model of Trade: Zeros, Excess Zeros and Zero-inflated Estimation

We analyse inter-regional research collaboration as measured by scientific publications and patents with multiple addresses, covering 1316 NUTS3 regions in 29 European countries. The estimates of gravity equations show the effects of geographical and institutional distance on research collaboration. We also find evidence for the existence of elite structures between excellence regions and between capital regions. The results suggest that current EU science policy to stimulate research collaboration is legitimate, but doubt the compatibility between EU science policy and EU cohesion policy.

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The geography of collaborative knowledge production in Europe

Why consumers shop via the Internet, is a frequently asked question. As yet, the impact of spatial variables on e-shopping has received little attention. In this paper we report our investigation of the spatial distribution of Internet users and online buyers in the Netherlands for the time period 1996 – 2001 and the impact of spatial variables (residential environment and shop accessibility) on e-shopping. Two hypotheses are tested empirically. The first is that e-shopping is a predominantly urban phenomenon, because new technology usually starts in centres of innovation (innovation-diffusion hypothesis). The second is that people are more likely to adopt e-shopping when their accessibility to shops is relatively low (efficiency hypothesis). Our findings indicate that Internet use and online buying are still largely urban phenomena in the Netherlands, but that there is a trend towards diffusion to the weakly urbanised and rural areas. Not only the innovation diffusion hypothesis, but also the efficiency hypothesis is confirmed by our findings. People living in a (very) strongly urbanised area have a higher likelihood of buying online, but people with a low shop accessibility buy more often online. The analysis also shows that the support for the two hypotheses depends on the type of product. Airline tickets are still mainly bought in very strongly urbanised areas, whereas compact discs, videos, DVDs, and clothing are bought relatively more often in weakly urbanised areas. In conclusion, geography seems to matter for e-shopping.

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E-Shopping in the Netherlands: Does Geography Matter?

In contemporary literature on changing urban systems, it is often argued that the traditional central place conceptualisation is outdated and should be replaced by a network view that emphasises the increasing criss-crossing pattern of interdependencies between spatial units. This paper tests for urban network development by looking at commuting patterns in the Greater South East UK. The analysis is based on census commuting interaction data for three points in time during the past three decades (1981, 1991, and 2001). Although the empirical results indicate that the Greater South East UK can still not be characterized as a polycentric urban region or integrated urban network, there is some evidence for urban network development at the local, intra-urban, level as well as a decentralization of the system at the regional, inter-urban, level.

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Frank van Oort

Papers

Related variety, unrelated variety and regional economic growth

On the Specification of the Gravity Model of Trade: Zeros, Excess Zeros and Zero-inflated Estimation

The geography of collaborative knowledge production in Europe

E-Shopping in the Netherlands: Does Geography Matter?

Functional Polycentrism and Urban Network Development in the Greater South East, United Kingdom: Evidence from Commuting Patterns, 1981–2001