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Market Potential, Spatial Dependences and Spillovers in European Regions

Author

Listed:
  • Fernando Bruna
  • Jesus Lopez-Rodriguez
  • Andrés Faíña

Abstract

Bruna F., Lopez-Rodriguez J. and Faíña A. Market potential, spatial dependences and spillovers in European regions, Regional Studies. This paper reinterprets the new economic geography (NEG) ‘wage’ equation by distinguishing two different types of spatial dependences: a global spatial trend and local spatial autocorrelation. A measure of the variable Market Potential in this equation can capture both a global core–periphery pattern and spillovers, while the standard weights matrices of spatial econometrics tend to be designed to capture short-distance interactions among neighbours. Using cross-sectional European regional data, the paper compares different weighting schemes to build spatial lags. The estimation of spatial models of an NEG equation for gross value added per capita (GVApc) reveals new research challenges.

Suggested Citation

  • Fernando Bruna & Jesus Lopez-Rodriguez & Andrés Faíña, 2016. "Market Potential, Spatial Dependences and Spillovers in European Regions," Regional Studies, Taylor & Francis Journals, vol. 50(9), pages 1551-1563, September.
    • Handle: RePEc:taf:regstd:v:50:y:2016:i:9:p:1551-1563
    DOI: 10.1080/00343404.2015.1048796
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    References listed on IDEAS

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    1. Pierre-Philippe Combes & Thierry Mayer & Jacques-François Thisse, 2008. "Economic Geography: The Integration of Regions and Nations," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00311000, HAL.
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    Cited by:

    1. Gabrielle Gambuli, 2023. "Navigating the Geography of Regional Disparities: Market Access and the Core-Periphery Divide," Thema Working Papers 2023-05, THEMA (Théorie Economique, Modélisation et Applications), CY Cergy-Paris University, ESSEC and CNRS.
    2. Jesus Lopez-Rodriguez & Jorge Guido Sotomayor-Pereira2, 2018. "Geographical Economics and Income Disparities Across Ecuadorian Regions: Analysis for the period 2007-2014," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 662-687.
    3. Fernando Bruna, 2024. "Market potential: the measurement of domestic market size," Letters in Spatial and Resource Sciences, Springer, vol. 17(1), pages 1-12, December.
    4. Pinar, Mehmet & Karahasan, Burhan Can, 2026. "Heterogeneous impact of innovation on economic development: Evidence from EU regions," Technology in Society, Elsevier, vol. 84(C).
    5. Bruna, Fernando & Faíña, Andrés & Lopez-Rodriguez, Jesus, 2014. "Market Potential and the curse of distance in European regions," MPRA Paper 56747, University Library of Munich, Germany.
    6. Christoph Hammer & Aurélien Fichet de Clairfontaine, 2016. "Trade Costs and Income in European Regions," Department of Economics Working Papers wuwp220, Vienna University of Economics and Business, Department of Economics.
    7. Fernando BRUNA & Isabel NEIRA & Marta PORTELA, 2019. "Horizontal And Vertical Contexts On Europeans’ Well-Being," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 19(2), pages 37-56.
    8. Fichet de Clairfontaine, Aurélien & Hammer, Christoph, 2016. "Trade Costs and Income in European Regions: Evidence from a regional bilateral trade dataset," Department of Economics Working Paper Series 220, WU Vienna University of Economics and Business.
    9. Rawaa Laajimi & Laurence Delattre & Hubert Jayet, 2024. "What demand and supply forces determine the location of off-farm points of sale in short food supply chains: Evidence from Nord and Pas-de-Calais, France," French Stata Users' Group Meetings 2024 25, Stata Users Group.
    10. Fernando Bruna, 2015. "Why do empirical tests tend to accept the NEG? An alternative approach to the 'wage equation' in European regions," Working Papers 15-11, Asociación Española de Economía y Finanzas Internacionales.
    11. María Gutiérrez-Portilla & Adolfo Maza & María Hierro, 2018. "Foreigners versus natives in Spain: different migration patterns? Any changes in the aftermath of the crisis?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 61(1), pages 139-159, July.
    12. Aurélien Fichet de Clairfontaine & Christoph Hammer, 2018. "Is the wage equation spatial enough? Evidence from a novel regional trade dataset," Review of International Economics, Wiley Blackwell, vol. 26(3), pages 610-633, August.

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