IDEAS home Printed from https://ideas.repec.org/p/oec/ecoaaa/602-en.html
   My bibliography  Save this paper

The Contribution of Economic Geography to GDP Per Capita

Author

Listed:
  • Hervé Boulhol

    (OECD)

  • Alain de Serres

    (OECD)

  • Margit Molnar

    (OECD)

Abstract

This paper examines how much of the dispersion in economic performance across OECD countries can be accounted for by economic geography factors. More specifically, two aspects of economic geography are examined, namely the proximity to areas of dense economic activity and endowments in natural resources. To do so, various indicators of distance to markets, transportation costs, and dependence on natural resources are added as determinants in an augmented Solow model, which serves as a benchmark. Three measures of distance to markets are found to have a statistically significant effect on GDP per capita: the sum of bilateral distances, market potential and the weighted sum of market access and supplier access. And the estimated economic impact is far from negligible. The reduced access to markets relative to the OECD average could contribute negatively to GDP per capita by as much as 10% in Australia and New Zealand. Conversely, a favourable impact of around 6-7% of GDP is found in the case of two centrally-located countries: Belgium and the Netherlands. Endowments in natural resources are also found to have a significant positive effect on GDP per capita, suggesting that OECD countries have, on average, escaped the natural resource curse or severe forms of the Dutch disease. The paper provides also some tentative evidence that spending on R&D and human capital might have a stronger effect on GDP per capita in countries with a higher degree of urban concentration. La contribution de l'économie géographique au PIB par tête Ce papier analyse la contribution des facteurs géographiques à la dispersion des performances économiques entre pays de l’OCDE. Plus particulièrement, deux aspects de l’économie géographique sont étudiés : la proximité de zones denses d’activités économiques et les dotations en ressources naturelles. Pour se faire, divers indicateurs de distance par rapport aux marchés, de coûts de transports, et de dépendance envers les ressources naturelles sont ajoutés comme déterminants dans un modèle de Solow augmenté, utilisé comme référence. Trois mesures de distance sont estimées avoir un effet significatif sur le PIB par habitant : la somme des distances bilatérales, le potentiel de marché et la somme pondérée de l’accès aux marchés et de l’accès aux fournisseurs. De plus, l’impact économique estimé est loin d’être négligeable. L’éloignement par rapport aux marchés pourrait pénaliser l’Australie et la Nouvelle Zélande, par rapport à la moyenne des pays de l’OCDE, à hauteur d’environ 10% de PIB. A l’inverse, la Belgique et les Pays Bas bénéficieraient de leur position centrale pour environ 6-7% de PIB. Les dotations en ressources naturelles sont estimées avoir un effet positif significatif sur le PIB par habitant, suggérant que les pays de l’OCDE ont, en moyenne, échappé au fléau des ressources naturelles ou aux formes sévères de la maladie hollandaise. Des premières indications suggèrent également que les dépenses en R&D et en capital humain peuvent avoir un effet plus fort sur le PIB par tête dans les pays ayant un fort degré de concentration urbaine.

Suggested Citation

  • Hervé Boulhol & Alain de Serres & Margit Molnar, 2008. "The Contribution of Economic Geography to GDP Per Capita," OECD Economics Department Working Papers 602, OECD Publishing.
  • Handle: RePEc:oec:ecoaaa:602-en
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1787/242216186836
    Download Restriction: no

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sylvanus Kwaku Afesorgbor & Kaleb Girma Abreha, 2015. "Preferential Market Access, Foreign Aid and Economic Development," Economics Working Papers 2015-04, Department of Economics and Business Economics, Aarhus University.
    2. Orsetta Causa & Alain de Serres & Nicolas Ruiz, 2015. "Can pro-growth policies lift all boats?: An analysis based on household disposable income," OECD Journal: Economic Studies, OECD Publishing, vol. 2015(1), pages 227-268.
    3. Mercedes Delgado & Christian Ketels & Michael E. Porter & Scott Stern, 2012. "The Determinants of National Competitiveness," NBER Working Papers 18249, National Bureau of Economic Research, Inc.
    4. Clovis Kerdrain & Isabell Koske & Isabelle Wanner, 2011. "Current Account Imbalances: can Structural Reforms Help to Reduce Them?," OECD Journal: Economic Studies, OECD Publishing, vol. 2011(1), pages 1-44.
    5. Mark Obren & Bronwyn Howell, 2014. "The tyranny of distance prevails: HTTP protocol latency and returns to fast fibre internet access network deployment in remote economies," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 52(1), pages 65-85, January.
    6. Xingqiang Du, 2016. "Does Confucianism Reduce Board Gender Diversity? Firm-Level Evidence from China," Journal of Business Ethics, Springer, vol. 136(2), pages 399-436, June.
    7. Selin Ozyurt & Stephane Dees, 2015. "Regional dynamics of growth in the European Union: To what extent spatial spillovers matter?," ERSA conference papers ersa15p242, European Regional Science Association.
    8. Orsetta Causa & Alain de Serres & Nicolas Ruiz, 2015. "Structural reforms and income distribution," OECD Economic Policy Papers 13, OECD Publishing.
    9. Ahrend, Rüdiger, 2012. "Understanding Russian regions’ economic performance during periods of decline and growth—An extreme bound analysis approach," Economic Systems, Elsevier, vol. 36(3), pages 426-443.
    10. J.A. Bikker, 2009. "An extended gravity model with substitution applied to international trade," Working Papers 09-17, Utrecht School of Economics.
    11. Bibek Adhikari & Romain A Duval & Bingjie Hu & Prakash Loungani, 2016. "Can Reform Waves Turn the Tide? Some Case Studies Using the Synthetic Control Method," IMF Working Papers 16/171, International Monetary Fund.
    12. Sebastian Barnes & Romain Bouis & Philippe Briard & Sean Dougherty & Mehmet Eris, 2013. "The GDP Impact of Reform: A Simple Simulation Framework," OECD Economics Department Working Papers 834, OECD Publishing.
    13. Michael Jetter & Saskia Mösle & David Stadelmann, 2017. "Landlockedness and Economic Development: Analyzing Subnational Panel Data and Exploring Mechanisms," CESifo Working Paper Series 6733, CESifo Group Munich.
    14. Andrea Elekes, 2011. "Cohesion and/or Growth?," Public Finance Quarterly, State Audit Office of Hungary, vol. 56(1), pages 108-124.
    15. 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.
    16. Dées, Stéphane & Özyurt, Selin, 2015. "Regional dynamics of economic performance in the EU: To what extent spatial spillovers matter?," Working Paper Series 1870, European Central Bank.
    17. Christophe Gouel & Nina Kousnetzoff & Hassan Salman, 2008. "Commerce international et transports : tendances du passe et prospective 2020," Working Papers 2008-28, CEPII research center.
    18. Clovis Kerdrain & Isabell Koske & Isabelle Wanner, 2010. "The Impact of Structural Policies on Saving, Investment and Current Accounts," OECD Economics Department Working Papers 815, OECD Publishing.
    19. Romain Bouis & Romain Duval & Fabrice Murtin, 2011. "The Policy and Institutional Drivers of Economic Growth Across OECD and Non-OECD Economies: New Evidence from Growth Regressions," OECD Economics Department Working Papers 843, OECD Publishing.

    More about this item

    Keywords

    coûts de transport; distance; distance; economic geography; GDP-per-capita; natural resources; PIB par tête; ressources naturelles; transport costs; économie géographique;

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oec:ecoaaa:602-en. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: http://edirc.repec.org/data/edoecfr.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.