The Balassa Index Meets the Dissimilarity Theil Index: a Decomposition Methodology for Location Studies
AbstractIt is well known that the broad concept of localisation has two connotations, namely, regional specialisation and industrial concentration. The main purpose of this paper is to introduce an entropy index of overall localisation suitable to conceptualise specialisation and concentration as the two sides of the same medal in a nested geographical perspective. The system of dissimilarity entropy measures is potentially applicable to the assessment of the spatial distribution of several economic phenomena when a twofold geographical level of analysis is considered. In the specific case, the decomposition provides an accurate method to quantify the cross-country divergence in localisation from the agglomeration within countries.
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Bibliographic InfoPaper provided by Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali in its series Working Papers with number 274.
Date of creation: Nov 2006
Date of revision:
concentration; dissimilarity entropy index; localisation; specialisation; within-between country decomposition;
Find related papers by JEL classification:
- C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
- L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-11-18 (All new papers)
- NEP-GEO-2006-11-18 (Economic Geography)
- NEP-URE-2006-11-18 (Urban & Real Estate Economics)
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