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Borders Matter! - Regional Integration in Europe and North America

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  • Ulrich Blum

    ()
    (TU Dresden)

Abstract

We analyze the spatial interaction among regions in North America and in Western Europe. We use a gravity model extended by a spatial correlation structure where data allows to evaluate the spatial interaction in two dimensions: level of impact and the length of the spatial tail. This allows us to address to effects external to the gravity model: importance of neighboring regions on the respective region and size of the cluster of regions. We find that the methodology employed improves the statistical quality of results and their economic interpretation. We conclude that national borders matter and that the North American regional structure, i.e. its cluster structure, is more polarized in terms of firm and spatial network structure than that of Europe. We argue that this relates to different types of institutional arrangements with effects on the spatial division of labor.

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Bibliographic Info

Article provided by Justus-Liebig University Giessen, Department of Statistics and Economics in its journal Journal of Economics and Statistics.

Volume (Year): 223 (2003)
Issue (Month): 5 (September)
Pages: 513-531

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Handle: RePEc:jns:jbstat:v:223:y:2003:i:5:p:513-531

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Keywords: Autocorrelation; border; Europe; gravitation model; integration; North America;

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References

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  2. Xavier Sala-i-Martin, 1996. "Transfers, Social Safety Nets, and Economic Growth," IMF Working Papers 96/40, International Monetary Fund.
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  4. Masahisa Fujita & Tomoya Mori, 1998. "original: On the dynamics of frontier economies: Endogenous growth or the self-organization of a dissipative system?," The Annals of Regional Science, Springer, vol. 32(1), pages 39-62.
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  18. Button, Kenneth J & Pentecost, Eric J, 1995. "Testing for Convergence of the EU Regional Economies," Economic Inquiry, Western Economic Association International, vol. 33(4), pages 664-71, October.
  19. Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-85, December.
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  22. Nijkamp, Peter, 1975. "Reflections on gravity and entropy models," Regional Science and Urban Economics, Elsevier, vol. 5(2), pages 203-225, May.
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