County-level determinants of local public services in Appalachia: a multivariate spatial autoregressive model approach
AbstractA multivariate spatial autoregressive model of local public expenditure determination with autoregressive disturbance is developed and estimated in this paper. The empirical model is developed on the principles of utility maximization of a strictly quasi concave community utility function. The existence of spatial interdependence is tested using Moranâs I statistic and Lagrange Multiplier test statistics for both the spatial error and spatial lag models. The full model is estimated by efficient GMM following Kelejian and Pruchaâs (1998) approach using county-level data from 418 Appalachian counties. The results indicate the existence of significant spillover effects among local governments with respect to spending in local public services. The OLS estimates of the conventional (non spatial) model of local public expenditure determination and the corresponding maximum likelihood estimates of the spatial lag and the spatial error models are also presented for comparison purposes. The GMM estimates are found to be more efficient.
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Bibliographic InfoArticle provided by Springer in its journal The Annals of Regional Science.
Volume (Year): 49 (2012)
Issue (Month): 1 (August)
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- Gebremeskel Gebremariam & Tesfa Gebremedhin & Peter Schaeffer, 2006. "County-level Determinants of local Public Services in Appalachia: A Multivariate Spatial Autoregressive Model Approach," Working Papers 200609, Regional Research Institute, West Virginia University.
- R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
- C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
- P28 - Economic Systems - - Socialist Systems and Transition Economies - - - Natural Resources; Environment
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