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Accounting for Neighboring Effects in Measures of Spatial Concentration

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Author Info

  • Paulo Guimarães

    ()
    (University of South Carolina and CEMPRE)

  • Octávio Figueiredo

    ()
    (CEMPRE and Faculdade de Economia, Universidade do Porto)

  • Douglas Woodward

    ()
    (University of South Carolina)

Abstract

A common problem with spatial economic concentration measures (e.g. Gini, Herfindhal, entropy and Ellison-Glaeser indices) is accounting for the position of regions in space. While they purport to measure spatial clustering, these statistics are confined to calculations within individual areal units. They are insensitive to the proximity of regions - to neighboring effects. Clearly, economic clusters may cross the boundaries of the regions. Yet with current measures, any industrial agglomeration that traverses boundaries will be chopped into two or more pieces. Activity in adjacent spatial units is treated in exactly the same way as activity in far-flung, non-adjacent areas. This paper shows how some popular measures of spatial concentration relying on areal data can be modified to account for neighboring effects and spatial autocorrelation. With a U.S. application, we also show that the new instruments we propose are useful and easy to implement.

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File URL: http://www.fep.up.pt/investigacao/workingpapers/09.12.22_wp353.pdf
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Bibliographic Info

Paper provided by Universidade do Porto, Faculdade de Economia do Porto in its series FEP Working Papers with number 353.

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Length: 23 pages
Date of creation: Dec 2009
Date of revision:
Handle: RePEc:por:fepwps:353

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Keywords: Measures of Agglomeration; Spatial Concentration;

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Cited by:
  1. Eric Marcon & Florence Puech, 2012. "A typology of distance-based measures of spatial concentration," Working Papers halshs-00679993, HAL.
  2. Register, D. Lane & Lambert, Dayton M. & English, Burton C. & Jensen, Kimberly L. & Menard, R. Jamey & Wilcox, Michael D., 2012. "Geographic Distribution of Renewable Energy Sector Industries: An Analysis Using Recent Developments in Industry Concentration Measurement," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124038, Agricultural and Applied Economics Association.
  3. Elena Lasarte & Miguel Angel Marquez Paniagua, 2014. "Decomposition of Regional Income Inequality and Neighborhood Component: A Spatial Theil Index," Working Papers. Serie EC 2014-03, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  4. Kristian Behrens & Théophile Bougna, 2013. "An Anatomy of the Geographical Concentration of Canadian Manufacturing Industries," Cahiers de recherche 1327, CIRPEE.

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