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Spatial Externalities and Local Economic Growth

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  • Sonia Deidda
  • Raffaele Paci

    ()

  • Stefano Usai

    ()

Abstract

The growing interest on the economic geography issues has provided new vigour to the research efforts aiming at explaining economic phenomena without neglecting space. In particular several studies have focused on the role of spatially bounded externalities on firms agglomeration processes at the local industry level. The main objective of this paper is to assess the role of a large set of potential determinants of the process of local agglomeration of economic activity and also to analyse the issue of spatial association of the local growth process. We focus on the case of Italy making use of a very ample database on socio-economic indicators for 784 Local Labour Systems and 34 sectors over the period 1991-96. Our database cover both the manufacturing and the service sectors so that the whole economic system is considered. Our econometric results show that local growth in Italy is not a homogeneous process. On the contrary, it is characterized by significant differences across macro regions and sectors with respect to the relevance of the explanatory factors. Among the most important determinants of local industry growth, it is worth mentioning the positive role of the diversity externalities. We also find robust evidence of the negative influence of specialisation externalities on labour dynamics at the local industry level. Moreover, we have assessed the effects of other determinants of local growth like human capital, social environment and network externalities. Finally, the spatial analysis shows that in the aggregate economy and also in some sectors there is the presence of spatial autocorrelation and therefore dynamic spatial models have been estimated.

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Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa03p81.

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Date of creation: Aug 2003
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Handle: RePEc:wiw:wiwrsa:ersa03p81

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Citations

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Cited by:
  1. Francesca Mameli & Simona Iammarino & Ron Boschma, 2012. "Regional variety and employment growth in Italian labour market areas: services versus manufacturing industries," Working Papers 4, Birkbeck Centre for Innovation Management Research, revised Mar 2012.
  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.
  3. Rafael Boix & Joan Trullén, 2007. "Knowledge, networks of cities and growth in regional urban systems," Papers in Regional Science, Wiley Blackwell, vol. 86(4), pages 551-574, November.
  4. Rafael Boix & Joan Trullén, 2004. "Knowledge, networks of cities and growth in regional urban systems: theory, measurement and policy implications," ERSA conference papers ersa04p85, European Regional Science Association.
  5. R. Paci & S. Usai, 2006. "Agglomeration economies and growth-The case of Italian local labour systems, 1991-2001," Working Paper CRENoS 200612, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  6. Christ, Julian P., 2009. "New Economic Geography reloaded: localized knowledge spillovers and the geography of innovation," FZID Discussion Papers 01-2009, University of Hohenheim, Center for Research on Innovation and Services (FZID).
  7. G. Marletto, 2006. "La politica dei trasporti come politica per l’innovazione: spunti da un approccio evolutivo," Working Paper CRENoS 200605, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  8. O. Carboni & G. Medda, 2007. "Government Size and the Composition of Public Spending in a Neoclassical Growth Model," Working Paper CRENoS 200701, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.

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