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Related Variety, Unrelated Variety and Regional Functions: A spatial panel approach

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  • Matthias Brachert

    ()

  • Asier Alexander Kubis
  • Mirko Titze

Abstract

The paper presents estimates for the impact of related variety, unrelated variety and the functions a region performs in the production process on regional employment growth in Germany. We argue that regions benefit from the existence of related activities that facilitate economic development. Thereby the sole reliance of the related and unrelated variety concept on standard industrial classifications (SIC) remains debatable. We offer estimations for establishing that conceptual progress can be made when the focus of analysis goes beyond solely considering industries. We develop an industry-function based approach of related and unrelated variety and test our hypothesis by the help of spatial panel approach. Our findings suggest that related variety as same as unrelated variety facilitate regional employment growth in Germany. However, the drivers behind these effects do differ. While the positive effect of related variety is driven by high degrees of relatedness in the regional “R&D” and “White-Collar”-functions, the effects of unrelated variety are spurred by “Blue Collar”-functions in this period.

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Bibliographic Info

Paper provided by Utrecht University, Section of Economic Geography in its series Papers in Evolutionary Economic Geography (PEEG) with number 1301.

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Length: 24 pages
Date of creation: Jan 2013
Date of revision: Jan 2013
Handle: RePEc:egu:wpaper:1301

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References

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  1. Gilles Duranton & Diego Puga, 2001. "From sectoral to functional urban specialisation," LSE Research Online Documents on Economics 20101, London School of Economics and Political Science, LSE Library.
  2. Ron Boschma, 2005. "Proximity and Innovation: A Critical Assessment," Regional Studies, Taylor & Francis Journals, vol. 39(1), pages 61-74.
  3. Frank Neffke & Martin Svensson Henning, 2009. "Skill-relatedness and firm diversification," Papers on Economics and Evolution 2009-06, Max Planck Institute of Economics, Evolutionary Economics Group, revised Oct 2010.
  4. Bode, Eckhardt, 1998. "Lokale Wissensdiffusion und regionale Divergenz in Deutschland," Open Access Publications from Kiel Institute for the World Economy 1038, Kiel Institute for the World Economy (IfW).
  5. Frank Neffke & Martin Henning & Ron Boschma, 2011. "How Do Regions Diversify over Time? Industry Relatedness and the Development of New Growth Paths in Regions," Economic Geography, Clark University, vol. 87(3), pages 237-265, 07.
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Cited by:
  1. Luca Andriani, 2013. "Is Acting Prosocially Beneficial for the Credit Market?," Management Working Papers 4, Birkbeck Department of Management, revised Jun 2013.
  2. Francesca Mameli & Simona Iammarino & Ron Boschma, 2012. "Regional variety and employment growth in Italian labour market areas: services versus manufacturing industries," Papers in Evolutionary Economic Geography (PEEG) 1203, Utrecht University, Section of Economic Geography, revised Feb 2012.

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