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Bayesian estimation of spatial externalities using regional production function: the case of China and Japan

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  • Yoshihiro Hashiguchi

    (Kobe University)

Abstract

This paper used regional panel data for Chinese provinces from 1979 to 2003, and for Japanese prefectures from 1955 to 1998, to estimate the spatial externalities (or spatial multiplier effects) using a production function and Bayesian methodology, and to investigate the long-run behavior of the spatial externalities of each country. According to the estimation results, China's spatial externalities increased its domestic production significantly after 1994, which tended to increase until 2003. Before 1993, however, its spatial externalities were not significant. Japan's spatial externalities showed fluctuating values throughout the sample period. Furthermore, the movement of the spatial externalities was correlated with Japan's business conditions: the externalities showed a high value in the economic boom, and a low value in the economic depression. This could mean that spatial externalities correlate mainly with business conditions.

Suggested Citation

  • Yoshihiro Hashiguchi, 2010. "Bayesian estimation of spatial externalities using regional production function: the case of China and Japan," Economics Bulletin, AccessEcon, vol. 30(1), pages 751-764.
    • Handle: RePEc:ebl:ecbull:eb-09-00630
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    References listed on IDEAS

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    Cited by:

    1. Seya, Hajime & Tsutsumi, Morito & Yamagata, Yoshiki, 2012. "Income convergence in Japan: A Bayesian spatial Durbin model approach," Economic Modelling, Elsevier, vol. 29(1), pages 60-71.
    2. Tanaka, Kiyoyasu & Hashiguchi, Yoshihiro, 2017. "Agglomeration economies in the formal and informal sectors : a Bayesian spatial approach," IDE Discussion Papers 666, Institute of Developing Economies, Japan External Trade Organization(JETRO).

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    More about this item

    Keywords

    Spatial externalities; Bayesian estimation; Production function;
    All these keywords.

    JEL classification:

    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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