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A regional model of endogenous growth without scale assumptions

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  • Steven Bond-Smith
  • Philip McCann
  • Les Oxley

Abstract

In this paper we model growth using a scale-neutral approach to innovation allowing differences between regions to emerge due to regional mechanisms. In this model, agglomeration is growth enhancing as the scale effect for innovation arises from greater access to knowledge rather than any assumed scale effects in growth-modelling techniques. Furthermore, entrepreneurs are assumed to choose the location of firms endogenously so as to minimize the costs of innovation, transport and living. The effects of such mechanisms are such that any policies that increase knowledge spillovers between locations will enhance growth and equality, but may be destabilizing for agglomeration.

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  • Steven Bond-Smith & Philip McCann & Les Oxley, 2018. "A regional model of endogenous growth without scale assumptions," Spatial Economic Analysis, Taylor & Francis Journals, vol. 13(1), pages 5-35, January.
    • Handle: RePEc:taf:specan:v:13:y:2018:i:1:p:5-35
    DOI: 10.1080/17421772.2018.1392038
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    Cited by:

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    5. Steven Bond‐Smith, 2019. "The Decades‐Long Dispute Over Scale Effects In The Theory Of Economic Growth," Journal of Economic Surveys, Wiley Blackwell, vol. 33(5), pages 1359-1388, December.
    6. Steven Bond-Smith, 2022. "Diversifying Hawai‘i’s specialized economy: A spatial economic perspective," Working Papers 2022-5, University of Hawaii Economic Research Organization, University of Hawaii at Manoa.
    7. Alexander Nurse & Olivier Sykes, 2020. "Place-based vs. place blind? – Where do England’s new local industrial strategies fit in the ‘levelling up’ agenda?," Local Economy, London South Bank University, vol. 35(4), pages 277-296, June.
    8. Sergey Kondyan & Karine Yenokyan, 2019. "Cross-country Knowledge Spillovers and Innovations in Less Developed Countries in the Context of the Schumpeterian Growth Model," Journal of Industry, Competition and Trade, Springer, vol. 19(3), pages 479-500, September.

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