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An examination of regional interaction and super-regions in Britain: An error correction model approach

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Author Info
DAVID GRAY
Abstract

Gray D. (2005) An examination of regional interaction and super-regions in Britain: an error correction model approach, Regional Studies 39 , 619--632. This paper examines spill-over effects among regions. Estimating error correction models of British rates of unemployment and conducting Granger-causality tests, it is found that, on a short-run basis, the West Midlands is a leading territory within a closely knit group of surrounding regions. The paper draws a distinction between a core and a leading region, suggesting the core region, the South East, is a follower, responding to, and magnifying, economic fluctuations. The policy implications are that current regional delineations may not be consistent with the demands of economic coherence at the national level and so is not optimal for the delivery of decentralized spatial economic policy. Indeed, as economic engineering in the high unemployment periphery has consequences for more prosperous areas, it may be better not to allow local administrators too much autonomy as the benefits of a better economic focus may be out-weighed by destabilizing tendencies that decentralization may impose on the whole system. This problem has consequences for, and may be compounded by, policy initiatives at the European level.

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Article provided by Taylor and Francis Journals in its journal Regional Studies.

Volume (Year): 39 (2005)
Issue (Month): 5 (July)
Pages: 619-632
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Handle: RePEc:taf:regstd:v:39:y:2005:i:5:p:619-632

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Related research
Keywords: Regional policy; Regional unemployment rates; Granger-causality; Error correction models; Overspill; Super-regions; European economic policy areas; Politique régionale; Taux de chô; mage régionaux; Causalité du type Granger; Modèles de correction pour l'erreur Retombées; Super-régions; Zones de politique économique europénnes; Regionalpolitik; regionale Erwerbslosenraten; Grangersche Kausalität; Modelle zur Irrtumsberichtigung; Bevölkerungsüberschuß; Supraregionen Gebiete der europäischen Wirtschaftspolitik; Política regional; Tasas regionales de desempleo; Causalidad de Granger; Modelos de corrección de errores; Desbordamiento; ; per regiones; Áreas de política económica europeas; JEL classifications: H77; R12; R15; R58;

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. David A. Dickey & Dennis W. Jansen & Daniel L. Thornton, 1991. "A primer on cointegration with an application to money and income," Review, Federal Reserve Bank of St. Louis, issue Mar, pages 58-78. [Downloadable!]
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  3. Jim Taylor, Colin Wren, 1997. "UK Regional Policy: An Evaluation," Regional Studies, Taylor and Francis Journals, vol. 31(9), pages 835-848, December. [Downloadable!] (restricted)
  4. Ashworth, John & Parker, Simon C, 1997. "Modelling Regional House Prices in the UK," Scottish Journal of Political Economy, Scottish Economic Society, vol. 44(3), pages 225-46, August. [Downloadable!] (restricted)
  5. David G. Blanchflower & Andrew J. Oswald, 1990. "The Wage Curve," NBER Working Papers 3181, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  6. David Gray, 2004. "Persistent Regional Unemployment Differentials Revisited," Regional Studies, Taylor and Francis Journals, vol. 38(2), pages 167-176, April. [Downloadable!] (restricted)
  7. Alderman, Harold, 1993. "Intercommodity Price Transmittal: Analysis of Food Markets in Ghana," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 55(1), pages 43-64, February.
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  8. MacKay, D I & Hart, R A, 1974. "Wage Inflation and the Phillips Relationship," The Manchester School of Economic & Social Studies, Blackwell Publishing, vol. 42(2), pages 136-61, June.
  9. Douglass C. North, 1955. "Location Theory and Regional Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 63, pages 243. [Downloadable!] (restricted)
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  1. Richard Harris & Victoria Kravtsova, 2009. "In Search of W," SERC Discussion Papers 0017, Spatial Economics Research Centre, LSE. [Downloadable!]
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