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Spatial externalities and empirical analysis: the case of Italy

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  • Mion, Giordano

Abstract

This paper aims at assessing the role of market linkages in shaping the spatial distribution of earnings. Using a space-time panel data on Italian provinces, I structurally estimate a NEG model in order to both test the coherence of theory with data, as well as to give a measure of the extent of spatial externalities. Particular attention has been paid to those endogeneity issues that arise when dealing with both structural models and spatial data. Results suggest that final demand linkages influence the location of economic activities and that their spread over space is, contrary to previous findings, not negligible.

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  • Mion, Giordano, 2004. "Spatial externalities and empirical analysis: the case of Italy," LSE Research Online Documents on Economics 42663, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:42663
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    More about this item

    Keywords

    Economic geography; spatial externalities; market potential;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R32 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other Spatial Production and Pricing Analysis

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