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Regional imbalances and market potential in Brazil

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Author Info
Pedro Vasconcelos Amaral (Cedeplar-UFMG)
Mauro Borges Lemos (Cedeplar-UFMG)
Rodrigo Ferreira Simões (Cedeplar-UFMG)
Flávia Chein Feres (Cedeplar-UFMG)

Additional information is available for the following registered author(s):

Abstract

Brazil presented in the last 30 years not only periods of economic growth but also crises and stagnation. The Brazilian regions’ performance (in face of the challenges and opportunities presented during this period) was not even at all, as we can see by the massive regional imbalances around the country. Various approaches have tried to understand this reality of economic activity spatial concentration. Among them, the emerging New Economic Geography (NEG). Could this theory comprehend and explain the regional unevenness on wages among Brazilian municipalities over the recent decades? Using 1980, 1991 and 2000 Brazilian Census data (at comparables municipalities areas), this paper aims to estimate the NEG wage equation, using panel data model with spatially correlated errors components. The results point to a strong relationship between market potential and wages, indicating that the NEG theoretical framework might be well fit to recent Brazilian municipalities’ reality.

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Publisher Info
Paper provided by Cedeplar, Universidade Federal de Minas Gerais in its series Textos para Discussão Cedeplar-UFMG with number td324.

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Length: 24 pages
Date of creation: Dec 2007
Date of revision:
Handle: RePEc:cdp:texdis:td324

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Postal: Cedeplar-FACE-UFMG Av. Antonio Carlos, 6627 Belo Horizonte, MG 31270-901 Brazil

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Related research
Keywords: New economic geography; market potential; Brazil;

Find related papers by JEL classification:
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
R12 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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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.:
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    Other versions:
  5. Bernard Fingleton, 2008. "A generalized method of moments estimator for a spatial model with moving average errors, with application to real estate prices," Empirical Economics, Springer, vol. 34(1), pages 35-57, February. [Downloadable!] (restricted)
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  7. Fingleton, Bernard, 2008. "Competing models of global dynamics: Evidence from panel models with spatially correlated error components," Economic Modelling, Elsevier, vol. 25(3), pages 542-558, May. [Downloadable!] (restricted)
  8. Bernard Fingleton, 2008. "A Generalized Method of Moments Estimator for a Spatial Panel Model with an Endogenous Spatial Lag and Spatial Moving Average Errors," Spatial Economic Analysis, Taylor and Francis Journals, vol. 3(1), pages 27-44. [Downloadable!] (restricted)
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    Other versions:
  10. Clélio Campolina Diniz, 1993. "Desenvolvimento poligonal no Brasil: nem desconcentração, nem contínua polarização," Nova Economia, Economics Department, Universidade Federal de Minas Gerais (Brazil), vol. 3(1), pages 35-64, September. [Downloadable!]
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  12. Steven Brakman & Harry Garretsen & Marc Schramm, 2000. "The Empirical Relevance of the New Economic Geography: Testing for a Spatial Wage Structure in Germany," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
  13. Mion, Giordano, 2003. "Spatial Externalities and Empirical Analysis: The Case of Italy," ZEW Discussion Papers 03-38, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
    Other versions:
  14. H. Hanson, Gordon, 2005. "Market potential, increasing returns and geographic concentration," Journal of International Economics, Elsevier, vol. 67(1), pages 1-24, September. [Downloadable!] (restricted)
    Other versions:
  15. Niebuhr, Annekatrin, 2004. "Market Access and Regional Disparities: New Economic Geography in Europe," Discussion Paper Series 26148, Hamburg Institute of International Economics. [Downloadable!]
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