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A Multi-Sector Export Base Model Of Long-Run Regional Employment Growth


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  • Lego, Brian
  • Gebremedhin, Tesfa G.
  • Cushing, Brian


The relationships between intersectoral export and local employment and regional economic growth are analyzed in a long-run equilibrium framework. Dynamic location quotients decompose regional employment into export and local components for multiple sectors. Johansen's Full-Information Maximum Likelihood (FIML) approach is used to identify the existence and resultant rank of the co-integrating relationship between sectoral export and local employment in West Virginia's four metropolitan areas. Empirical results indicate inter-sectoral basic and non-basic employment form a co-integrating system of equations. Furthermore, this analysis shows that inter-sector shocks to local and export employment may cause multipliers to be positive or negative in magnitude.

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Bibliographic Info

Article provided by Northeastern Agricultural and Resource Economics Association in its journal Agricultural and Resource Economics Review.

Volume (Year): 29 (2000)
Issue (Month): 2 (October)

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Handle: RePEc:ags:arerjl:31294

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Keywords: Labor and Human Capital;


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  1. Osterwald-Lenum, Michael, 1992. "A Note with Quantiles of the Asymptotic Distribution of the Maximum Likelihood Cointegration Rank Test Statistics," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 54(3), pages 461-72, August.
  2. James E. McNulty, 1977. "A Test of the Time Dimension in Economic Base Analysis," Land Economics, University of Wisconsin Press, vol. 53(3), pages 359-368.
  3. Johansen, Soren, 1995. "Likelihood-Based Inference in Cointegrated Vector Autoregressive Models," OUP Catalogue, Oxford University Press, number 9780198774501, September.
  4. Granger, C. W. J. & Newbold, P., 1974. "Spurious regressions in econometrics," Journal of Econometrics, Elsevier, vol. 2(2), pages 111-120, July.
  5. Clifton B. Luttrell & Charles M. Gray, 1970. "Metropolitan area growth: a test of export base concepts," Review, Federal Reserve Bank of St. Louis, issue Jul, pages 8-24.
  6. Mark S. Henry & J. C. O. Nyankori, 1981. "The Existence of Short-Run Economic Base Multipliers: Some New Empirical Evidence," Land Economics, University of Wisconsin Press, vol. 57(3), pages 448-458.
  7. Douglass C. North, 1955. "Location Theory and Regional Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 63, pages 243.
  8. Frank Giarratani & Paul D. McNelis, 1980. "Time Series Evidence Bearing on Crude Theories of Regional Growth," Land Economics, University of Wisconsin Press, vol. 56(2), pages 238-248.
  9. Lesage, James P. & Reed, J. David, 1989. "The dynamic relationship between export, local, and total area employment," Regional Science and Urban Economics, Elsevier, vol. 19(4), pages 615-636, December.
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Cited by:
  1. Sorenson, David J., 2007. "Assessing Economic Base Relationships in South Dakota," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 37(2).
  2. Jens Abildtrup & Virginie Piguet & Bertrand Schmitt, 2011. "The impact of agro-food industry on employment and population changes: The case of Denmark and France'," ERSA conference papers ersa10p1622, European Regional Science Association.
  3. Elena G. Irwin & Andrew M. Isserman & Maureen Kilkenny & Mark D. Partridge, 2010. "A Century of Research on Rural Development and Regional Issues," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 92(2), pages 522-553.


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