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Structural Interactions in Spatial Panels

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  • Arnab Bhattacharjee
  • Sean Holly

Abstract

Until recently, much effort has been devoted to the estimation of panel data regression models without adequate attention being paid to the drivers of diffusion and interaction across cross section and spatial units. We discuss some new methodologies in this emerging area and demonstrate their use in measurement and inferences on cross section and spatial interactions. Specifically, we highlight the important dis?tinction between spatial dependence driven by unobserved common factors and those based on a spatial weights matrix. We argue that, purely factor driven models of spatial dependence may be somewhat inadequate because of their connection with the exchangeability as?sumption. Limitations and potential enhancements of the existing methods are discussed, and several directions for new research are highlighted.

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Paper provided by Centre for Dynamic Macroeconomic Analysis in its series CDMA Working Paper Series with number 201003.

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Date of creation: 15 Jul 2010
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Handle: RePEc:san:cdmawp:1003

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Keywords: Cross Sectional and Spatial Dependence; Spatial Weights Matrix; Interactions and Diffusion; Monetary Policy Committee; Generalised Method of Moments.;

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Citations

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Cited by:
  1. Sánchez Navarro, Dennis, 2012. "Una propuesta metodológica para la definición de mercados geográficos relevantes
    [A proposed methodology for defining relevant geographic markets]
    ," MPRA Paper 44498, University Library of Munich, Germany.
  2. Arnab Bhattacharjee & Sean Holly, 2010. "Structural Interactions in Spatial Panels," CDMA Working Paper Series, Centre for Dynamic Macroeconomic Analysis 201003, Centre for Dynamic Macroeconomic Analysis.
  3. Arnab Bhattacharjee & Eduardo Anselmo de Castro & João Lourenço Marques, 2011. "Spatial Interactions in Hedonic Pricing Models: The Urban Housing Market of Aveiro, Portugal," Dundee Discussion Papers in Economics, Economic Studies, University of Dundee 253, Economic Studies, University of Dundee.
  4. Arnab Bhattacharjee & Chris Jensen-Butler, 2011. "Estimation of the Spatial Weights Matrix under Structural Constraints," Dundee Discussion Papers in Economics, Economic Studies, University of Dundee 254, Economic Studies, University of Dundee.
  5. Arnab Bhattacharjee & Eduardo Castro & Taps Maiti & João Marques, 2014. "Endogenous spatial structure and delineation of submarkets: A new framework with application to housing markets," SEEC Discussion Papers 1403, Spatial Economics and Econometrics Centre, Heriot Watt University.
  6. Joao Lourenço Marques & Eduardo Castro & Arnab Bhattacharjee & Paulo Batista, 2012. "SPATIAL HETEROGENEITY ACROSS SUBMARKETS: Housing submarket in an urban area of Portugal," ERSA conference papers ersa12p1111, European Regional Science Association.
  7. Arnab Bhattacharjee & Taps Maiti & Dennis Petrie, 2014. "Spatial structures of health outcomes and health behaviours in Scotland: Evidence from the Scottish Health Survey," SEEC Discussion Papers 1401, Spatial Economics and Econometrics Centre, Heriot Watt University.
  8. Bhattacharjee, Arnab & Jensen-Butler, Chris, 2013. "Estimation of the spatial weights matrix under structural constraints," Regional Science and Urban Economics, Elsevier, vol. 43(4), pages 617-634.

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