ALBERT

Notes:   This paper shows that in the Baltic countries, commuting reduces urban-rural wage and employment disparities and increases national output. To quantify the effect of commuting on wage differentials, two sets of earnings functions are estimated (based on Estonian, Latvian, and Lithuanian Labor Force Surveys) with location variables (capital city, rural, etc.) measured at the workplace and at the place of residence. We find that the ceteris paribus wage gap between capital city and rural areas, as well as between capital and other cities is significantly narrowed by commuting in some cases but remains almost unchanged in others. Different outcomes are explained by country-specific spatial patterns of commuting, educational and occupational composition of commuting flows, and presence or absence of wage discrimination against rural residents in urban markets. A treatment effects model is used to estimate individual wage gains to rural—urban or inter-city commuting; these gains are substantial in most but not all cases. Wage effects of commuting distance, as well as impact of education, gender, ethnicity, and local labor market conditions on the commuting decision are also explored.

Notes:   This paper argues that search theory is a useful addition to the way economists and geographers have approached the study of commuting behavior. This is illustrated by showing that introduction of a spatial element into the standard model of job search leads to the prediction of critical isochrones. Moreover, in the context of an urban economy with decentralized employment, the spatial search model predicts excess commuting. Search theory also suggests that regression toward the mean may play a confusing role in data describing the development of commutes over time, such as has been used in recent empirical work. Finally, the paper develops a simple spatial equilibrium search model in which employers set their wages optimally and searchers determine their reservation wages optimally in mutually consistent ways. The spatial element is crucial for the existence of such an equilibrium in which reservation wages of all searchers and wages set by all employers are identical.

Notes:   Clusters now form a central element in many regional economic development policies. Location within a cluster of related industries is thought to increase a firm's competitive advantage resulting in higher output and productivity growth rates than in similar firms located beyond the cluster. This study focuses on owner-managers operating small firms within a traditional cluster of metalworking industries and empirically examines the relationship between growth-orientation and the extent and nature of cluster embeddedness. The results indicate only a limited number of differences in growth-orientation given variations in levels of cluster embeddedness. Contrary to conventional wisdom, many of the most growth-oriented entrepreneurs focus their activities outside the cluster, especially in terms of market-based linkages. However, those firms with more advanced process technologies do tend to show above average within cluster linkages.

Notes:   The goal of this paper is twofold. The first goal is to incorporate spatial structure within shift-share analysis, to take into account interregional interaction in the decomposition analysis. Secondly, this paper develops a taxonomy of regional growth rate decompositions. A taxonomy of the spatial structure is presented; it comprises twenty alternative decomposition structures, including the original standard shift-share analysis as well as six alternative structures outlined in the taxonomy for non-spatial structures.

Notes: Book reviewed: Internet, Economic Growth and Globalization: Perspective on the New Economy in Europe, Japan and the USA. Edited by Claude E. Barfield, Günter Heiduk, and Paul J.J. Welfens: Springer, 2003. 385pp. ISBN 3-540-00286-3.

Notes:   This paper discusses various aspects of the economic analysis of commuting behavior. It starts with a review of two difficulties associated with urban economics models: the empirically falsified prediction of the relation between commuting time and income, and the presence of substantial excess commuting. Notwithstanding these anomalies, research that focuses directly on the value of travel time provides evidence that there is substantial resistance against commuting among large groups of workers. However, commuting costs are just one among many other explanatory variables for actual commuting behavior, and commuting itself has become much less onerous over time. This suggests that commuting costs play a much more limited role than has been assumed in the past. On the other hand, empirical evidence suggests that space is more important than one would be inclined to think on the basis of the considerations just given. These empirical regularities suggest that other space-related aspects of the functioning of urban labor and housing markets are more important than was previously thought.

Notes:   Commuting is popularly viewed as a stressful, costly, time-wasting experience from the individual perspective, with the attendant congestion imposing major social costs as well. However, several authors have noted that commuting can also offer benefits to the individual, serving as a valued transition between the home and work realms of personal life. Using survey data collected from about 1,300 commuting workers in three San Francisco Bay Area neighborhoods, empirical models are developed for four key variables measured for commute travel, namely: Objective Mobility, Subjective Mobility, Travel Liking, and Relative Desired Mobility. Explanatory variables include measures of general travel-related attitudes, personality traits, lifestyle priorities, and sociodemographic characteristics. Both descriptive statistics and analytical models indicate that commuting is not the unmitigated burden that it is widely perceived to be. About half of the sample were relatively satisfied with the amount they commute, with a small segment actually wanting to increase that amount. Both the psychological impact of commuting, and the amounts people want to commute relative to what they are doing now, are strongly influenced by their liking for commuting. An implication for policy is that some people may be more resistant than expected toward approaches intended to induce reductions in commuting (including, for example, telecommuting). New creativity may be needed to devise policies that recognize the inherent positive utility of travel, while trying to find socially beneficial ways to fulfill desires to maintain or increase travel.

Notes:   While previous research has generally found that immigration raises unemployment for natives, effects are often more muted than expected. Anticipated out-migration responses have been similarly difficult to discern. However, these findings may be byproducts of the long-run nature of most inquiries, which furthermore do not account for changes in natives’ labor force participation. In response, this study evaluates the impact of the arrival of low-skilled immigrants on low-skilled natives in urban areas over a five year period. Initial static results from the Census Basic Monthly Survey clearly indicate that immigrants have a significant negative impact on natives’ labor force participation. Building upon these static panel results, characteristics of immigrants’ destination choices are examined along with the ensuing adjustment process through dynamic analyses of local markets. Surges of immigrants significantly reduce the labor force participation of low-skilled natives, emphasizing this often neglected channel for labor market adjustment. Previous work may thus understate the true impact of immigrants on local labor markets by focusing on the longer term and ignoring adjustments through participation.

Notes: This paper presents some micro-evidence relevant to the “Porter Hypothesis” on the techno-economic consequences of Austrian Volatile Organic Compound (VOC) emission standards, the most restrictive of their kind in the world. Using firm-level survey data and complementing it with highly disaggregated foreign trade data, the paper explores whether the standards had a palpable impact on the competitiveness of Austrian manufacturers of paints, coatings, printing inks, and adhesives, whether compliance stimulated innovation in this industry, whether the standards crowded out other, more productive Research and Development (R&D), and whether compliance efforts gave rise to unexpected benefits of compliance. It finds no unequivocal aggregate impact on the competitiveness of regulated firms, yet does find some interesting variation with firm size. Moreover, the standards appear to have dampened import competition. The standards gave rise to considerable changes in firms’ product range and appear to have accelerated the rate of product innovation in the regulated industry. R&D spending to develop compliant products is found to be very unevenly distributed, mainly due to technological and, to a lesser extent, organizational factors. There is evidence that compliance efforts displaced or postponed existing R&D projects. However, there is also evidence that search for compliant products yielded unexpected and beneficial ideas, knowledge, and competencies.

Notes: Abstract Mobility is a necessary condition for the social and emotional well-being of older people. To meet their mobility needs, the elderly assign pivotal importance to the automobile despite the potential challenge of driving cessation and searching for alternatives to automobile transportation. Older persons’ generally strong reliance on the automobile varies, however, by land use patterns (density) as well as by demographic and socioeconomic characteristics. This paper analyzes the effects of spatial context and personal attributes on automobile reliance among the elderly. Using the 1995 Nationwide Personal Transportation Survey (NPTS) trip data, two models of automobile reliance among elderly (65+) trip makers are estimated. The results show that spatial context effects of automobile reliance vary by demographic characteristics; in particular, they are more pronounced for black than for white elderly. Moreover, race variation in automobile reliance is strongest in urban locations rather than less dense spatial contexts. Finally, the differentiation between being a passenger rather than a driver is salient in order to understand locational and racial variations in automobile reliance among the elderly.

Notes: Abstract This paper examines the relationship between quality of life, rural development, and several socioeconomic variables. The analysis utilizes data obtained from a survey questionnaire administered to a random sample of more than 2,000 residents in West Virginia, and spatial data obtained by geocoding the survey respondents’ addressees. Quality of life is measured by a three-point categorical measure of overall satisfaction, and development is measured by a goods and services availability index. A simultaneous ordered probit model is used to examine the relationships. The empirical results are consistent with the theoretical predictions and indicate a simultaneous relationship between quality of life satisfaction and rural development.

Notes: Abstract The use of the Internet and World Wide Web (WWW) as a distributive medium is seen by many businesses as a legitimate way to cut costs of operation. Confidence is growing in the use of this medium to transact business because of the increasing sophistication of firewalls, encryption software, and digital key technology. This paper presents empirical evidence from one offshore financial center where the process of legislative and regulatory reform put in place to establish confidence in the traditional provision of offshore financial services is now being used to regulate and legitimize the online distribution of such services. The results show that all firms surveyed for this study use the Internet for routine brochure-ware purposes and the larger firms (particularly in the offshore life insurance sector) are developing more sophisticated customized transactional functions via extranet platforms. Tensions exist though with respect to “regulatory grasp” via the Internet, as offshore places are being put under increased pressure by supranational organizations such as the Organization for Economic Cooperation and Development (OECD) and Financial Action Task Force (FATF) to require greater transparency in offshore financial transactions.

Notes: Utilizing data from the 1980 and 1990 U.S. census, this study investigates whether the passage of official-English legislation at the state level during the 1980s affected the housing acquisition of foreign-born Hispanics. The results suggest that both limited-English-proficient (LEP) and English-fluent Hispanic immigrants who resided in states that passed English-only legislation were less likely to acquire a home during the 1980s compared to their counterparts in other areas. Consistent with economic theory, however, the group that seemed to be most affected included older LEP residents. One explanation for these findings is that the official-English legislation mirrored growing xenophobia against foreign-born Hispanics, resulting in additional social stratification on the basis of ethnicity in housing markets.

Notes: The 1990s witnessed an enormous wave of mergers and acquisitions dramatically reconfigure the market structure of global telecommunications. In Europe and the U.S., telecommunications firms have steadily consolidated into a shrinking pool of providers, rapidly oligopolizing the industry. This paper reviews the number and size of mergers and acquisitions globally in the 1990s and charts the national patterns of purchasers and target firms, noting the overwhelming hegemony of American corporations. The reasons behind this process include globalization, deregulation, the convergence of digital technologies, the search for economies of scale and scope, and U.S. corporate tax laws. It also points to the impacts of this oligopolization on consumer prices, labor, equity of access to telecommunications services, and the political and cultural repercussions of increasingly concentrated ownership.

Notes: This paper examines the evolution of patent activities across U.S. states from 1963 to 1997. Several patterns are uncovered. First, there is invention catch-up by some lagging states. Second, the evidence is consistent with knowledge diffusion. Third, leading states unable to reinvent themselves lose their leads. Fourth, catch-up can be across a diverse field of activities or focused on select activities. State patent growth is positively correlated to industry R&D and a variable capturing labor skill and infrastructure quality. These provide rationale for state policy makers to increase support to programs that enhance labor skill (e.g., education) and infrastructure quality.

Notes: Economic impact studies overestimate the direct impact of an airport on travelers' expenditures. This occurs for two reasons. First, impact studies assume that the number of visitors traveling to the local area via the airport would fall to zero in the absence of the airport. Second, impact studies implicitly assume that local residents would continue to travel outside the local area in the same numbers as when the local airport is available. In other words, it is assumed that the demand for travel into the local area by visitors is perfectly elastic with respect to the time and money costs of travel, while the demand for travel by local residents is perfectly inelastic with respect to these variables. This paper develops a methodology that avoids both of these sources of error by explicitly incorporating air travel demand into the analysis. The methodology is applied to Tampa International Airport for the year 1996. It is shown that using the standard methodology would have resulted in an estimate of direct impacts sixteen times the size of the estimate made by using the methodology of this paper.

Notes: The effects on wage growth of management practices applied on public lands in the Northern Forest region of the United States are quantified. A central objective is to determine if the management of public lands for preservationist uses results in lower average wages. This is a frequent claim made by critics of land preservation who argue that preservationist management, by prohibiting resource extraction, causes the composition of employment to shift from high-wage jobs in resource-based manufacturing to low-wage jobs in the service sector. A model of simultaneous employment and net migration growth is estimated with data on non-metropolitan counties over the period 1990 to 1999 and applied in a recursive relationship to wage growth. In earlier studies, models of this type have typically been specified in levels. Time-series evidence that supports a preference for growth rates is provided as the form for such models. Exogenous variables in this model include the 1990 shares of the county land base that are publicly owned and managed for preservationist (non-extractive) uses and multiple (including extractive) uses. It was found that wage growth rates are not significantly affected by the shares of land under either management regime. As well, recent declines in national forest timber sales are found to have no effect on wage growth.

Notes: Constantinos I. Chlomoudis and Athanasios A. Pallis, European Union Port Policy: The Movement Towards A Long Term Strategy

Notes: This paper considers the case of Bangkok where, as in many Asian cities, the expansion of urban areas has outpaced the ability of public entities to manage and provide basic services. One potential way to improve the capacity of neighborhoods to assist in provision or improvement in environmental services is to enhance the positive contributions provided by local social networks and social capital. A conceptual framework is presented to explore the role of social networks in environmental management in polluted urban environments. This is followed by a brief description of the methodology and survey instrument used to collect information from a sample of community households in Bangkok and an analysis of the results from this survey regarding environmental practices, community action, and social networks. Some of the results suggest that increasing the number of social interactions that residents of a community experience is associated with increased community participation as, apparently, is increasing knowledge about what happens to waste or waste water after it leaves the community. Local public education efforts that focus on useful knowledge about environmental impacts may well be an effective way to encourage community participation.

Notes: This paper analyzes the effect of self–employed persons’ education on the success of their firms during the economic downturn and upturn of the 1990's. It is found that the business cycle affects the relative closure rates of firms run by self–employed with any level of education. Exit probability is lower for the highly educated during bust, but higher in boom. This is accounted for by two facts. First, running a small firm is argued to be a less attractive choice to wage work, particularly for the highly educated, due to lower earning prospects, less stable stream of earnings, and the cultural tradition of working in large corporations. Second, the highly educated faced a higher outside demand for their labor than did the less educated during economic upturn. Finally, it was found that regardless of the state of aggregate economy, firms run by the highly educated have higher growth probabilities than those run by less educated persons.

Notes: This study analyzes the evolution of China’s regional inequalities during the reform period of 1978–1998 based on three geographical scales, both output and livelihood indicators of economic well-being and three measures of inequality. The results indicate that interprovincial and regional inequalities declined between 1978 and 1990, but have widened steadily since 1990. Urban-rural disparity diminished before 1984, then experienced a decade-long surge afterwards to peak in 1994 at a much higher level and since 1994, it has been declining again. The levels of regional inequalities in China appear to be sensitive to changes in government development strategies and regional policies. Differential growth of the provincial economies shaped by the coast-oriented and urban-biased development strategies as well as selective open-door policy implemented by the Chinese government after the reform is the key to understanding the wax and wane in China’s regional inequalities. This paper discusses the factors that account for the changing regional inequalities in post-reform China and argues that government policies are likely to continue to influence the future trajectories of inequality change.

Notes: Books reviewed:Char Miller, Fluid Arguments: Five Centuries of Western Water ConflictMichael Dear, (ed.) From Chicago to L.A.: Making Sense of Urban TheoryMartin Dangerfield, Subregional Economic Cooperation in Central and Eastern Europe: The Political Economy of CEFTAKenneth Button and Roger Stough, Air Transport Networks: Theory and Policy Implications

Notes: This paper examines return migrants and new migrants to Montana: Who are they? Why do they move? Do return migrants move for different reasons than new migrants? Data from the 1994–1997 Montana Poll, a representative survey of Montana households, are used. A comparison of socio-economic differences of return and new migrants shows that the two migrant types are very similar in terms of education, income, and age. This stands in contrast to the findings of others who maintain that return migrants are negatively selected with respect to education. Logistic regressions were employed to identify the effect of age and place ties on reasons for moving. Return migrants and new migrants move to Montana for very similar reasons, with family being the most important primary reason for moving. Moving for lifestyle reasons, such as environmental quality and urban amenities, were found to systematically change with age. This could explain why people return to a place they left earlier in life. While other research on return migration compared return migrants and other migrants who left the same place of origin, this paper offers a comparison of return migrants and other migrants who seek out the same destination. Results from the Montana Poll suggest that the same destination attracts return migrants and new migrants with similar socio-economic characteristics who move there for very similar reasons.

Notes: This research explores the role of place in corporate location strategy by following the global footsteps of pharmaceutical giant Eli Lilly and Company. Examining a life science company model whose acquisitions strongly affected industry strategy provides examples of place characteristics modifying high tech corporate strategy in four very different metropolitan areas: Indianapolis, Research Triangle, San Diego and Shanghai. Targeted interviews explore institutional, human, and place features. This case study illustrates why choosing the best learning location—where both structured and informal information exchange networks can nurture companies—is key to achieving competitive advantage through site selection.

Notes: This paper examines return migrants and new migrants to Montana: Who are they? Why do they move? Do return migrants move for different reasons than new migrants? Data from the 1994–1997 Montana Poll, a representative survey of Montana households, are used. A comparison of socio-economic differences of return and new migrants shows that the two migrant types are very similar in terms of education, income, and age. This stands in contrast to the findings of others who maintain that return migrants are negatively selected with respect to education. Logistic regressions were employed to identify the effect of age and place ties on reasons for moving. Return migrants and new migrants move to Montana for very similar reasons, with family being the most important primary reason for moving. Moving for lifestyle reasons, such as environmental quality and urban amenities, were found to systematically change with age. This could explain why people return to a place they left earlier in life. While other research on return migration compared return migrants and other migrants who left the same place of origin, this paper offers a comparison of return migrants and other migrants who seek out the same destination. Results from the Montana Poll suggest that the same destination attracts return migrants and new migrants with similar socio-economic characteristics who move there for very similar reasons.

Notes: This paper departs from the existing growth literature in not assuming a priori a specific production technology and offering instead a theory of production technology that captures the effects of changes in the level, composition, and forces of accumulation of capital on the productivity of an economy. The theory of production technology shows that an affluent knowledge-rich economy violates the Inada second condition because of its high level of knowledge, human, and social capital. Substitution of knowledge capital for physical capital and the self-reinforcing nature of the process of accumulation of knowledge, human, and social capital are the engines of growth in such economies. Poor economies, on the other hand, may exhibit neoclassical production technology of diminishing returns to capital and get trapped into a low-level steady state owing to their ever-growing need for physical capital and also to unfavorable supply conditions for knowledge capital, lower levels of knowledge, human, and social capital in these economies being inadequate to trigger the self-reinforcing dynamics. The mechanics of endogenous growth are essentially different in rich and poor economies because the production possibility surface is non-convex in the former, and this difference explains the sustained divergence of their growth rates.

Notes: The aim of this paper is to challenge the characterization of paid informal work as a form of employment based on exploitative relations that should be eradicated. Using empirical evidence gathered through structured interviews with 511 households in deprived and affluent neighborhoods in British cities, this paper reveals that paid informal work in deprived areas is mostly conducted for kin, neighbors, and friends for co-operative reasons and is thus more like unpaid community exchange in the private sphere than exploitative employment. In consequence, the challenge for social and labor market policy is argued to be not to try to eradicate such work but to harness it in these deprived urban neighborhoods.

Notes: The effectiveness of intra-regional job search is influenced by how far people are willing to travel to new employment. While much has been written on the commuting patterns of those in work, relatively little research has been carried out on how far unemployed job seekers are prepared to commute. This paper presents and tests a model of factors influencing the maximum time unemployed job seekers would be willing to travel to a potential new job. Significant effects are found for a range of personal and demographic characteristics, including gender, years of education, type of job, and location. The evidence suggests support for the spatial mismatch hypothesis and shows differing accessibility to employment opportunities for certain types of unemployed people. The findings also suggest that models of the trade-off between leisure and work time should fully include travel-to-work time as part of this trade-off.

Notes: Recent studies have identified factors statistically related to differences in state economic growth. These findings relate to regional policy because they appear to identify political options that could then be justified as improving growth. This paper evaluates the reliability of these studies as policy guides. It finds that most statistical conclusions are fragile and are ttherefore risky policy guides Economic base theory performs well, and provides the most reliable state level policy options. These policies, however, have to be crafted carefully to avoid pitfalls associated with traditional (and perhaps unpopular) basic industries.

Notes: Books reviewed:Aura Reggiani, (ed.) Spatial Economic Science. New Frontiers in Theory And MethodologyFrans Boekema, Kevin Morgan, Silvia Bakers, and Roel Rutten, (eds.) Knowledge, Innovation and Economic Growth–The Theory and Practice of Learning RegionsGary E.Machlis and Donald R. Field, (eds.)National Parks and Rural Development: Practice And Policy in the United StatesJohn Kromer, Neighborhood Recovery: Reinvestment Policy for the New Hometown

Notes: One of the debates around new firm formation across sub-national territories focuses on whether regional differences in industrial structure are more important influences than regional differences in individual industry performance. The present research, using Value Added Tax (VAT) registration data, attempts to make a contribution to this debate in the United Kingdom (UK) context using a shift-share covariance model. Firm de-registrations and, as a consequence, net changes in firm stocks are also analyzed with similar questions in mind. The findings show that although the effects of industrial mix are significant across most regions, in several key regional contexts the industrial competitive effect dominates. The issue of the role of regional industrial concentration forms a second major theme of this paper. This basically involves a questioning as to whether concentration is a positive or negative force for new firm formation. The results of this research indicate that industrial concentration, measured through localization, is more important for firm deaths than for firm births (although significant for both), but not particularly relevant to the understanding of the net outcome of entry and exit processes. In the UK, regions with higher levels of industry concentration seem to be associated overall with relatively lower levels of both firm births and deaths.

Notes: Books reviewed: Hong Kong as a Global Metropolis, by David R. Meyer. Globalization and Networked Societies: Urban-Regional Change in Pacific Asia, by Yue-man Yeung. Regional Cohesion and Competition in the Age of Globalization, edited by Hirotada Kohno, Peter Nijkamp and Jacques Poot. Employee Benefits and Labor Markets in Canada and the United States, edited by William T. Alpert and Stephen A. Woodbury. The Atlanta Paradox, edited by David L. Sjoquist. The Economics of Sports, edited by William S. Kern. Environmentally Sustainable Economic Development, by Asayehgn Desta.

Notes: The effect of immigration on state and local budgets is a frequent topic of both political and academic conversations. A controversial issue among scholars is whether or not immigration induces outmigration of low income native born residents, a population movement which would potentially have implications for the jurisdictional distribution of immigration's fiscal impact. It is hypothesized here that if interstate poverty migration occurred, it should cause fiscal spillovers by distributing some of the public sector burden of immigration from immigrant “host” states to neighboring states. This paper uses cross-sectional state data from 1988–1995 to explore the relationship between immigration in neighbor states and state redistributive expenditures. The results suggest that there is a positive relationship between immigration to neighboring states and redistributive expenditures. While most discussion of the fiscal impact of immigration has focused on the effects on host states and localities, the implications of these findings are that there are fiscal spillovers to neighboring states, suggesting that fiscal impacts on host states have been over-estimated and effects on neighboring states have been underestimated. Additionally, the implications of recent welfare reform, which gives states the opportunity to use citizenship as a criterion for program eligibility, are discussed.

Notes: Measuring nonuse values is one of the most controversial topics facing environmental economists today. One important issue that has received little attention is determining who has economic standing with respect to nonuse losses from natural resource injuries. In this paper, a conceptual model for determining compensable nonuse losses is developed that is consistent with the Kaldor-Hicks principle of potential Pareto improvement, and then that model is applied to the results of a telephone survey on industrial water pollution in the lower Passaic River in northern New Jersey. One proposition from this model indicates that only people who have knowledge of the injured resource (i.e., 10 to 44 percent of respondents) can incur a compensable nonuse loss. A second proposition from the model indicates that demand for information about an injury to a familiar resource is a necessary condition for compensable nonuse losses. It was found that 81 percent of the respondents who were familiar with the lower Passaic River were likely to read, listen to, or watch a news story about the river. However, far fewer respondents familiar with the lower Passaic River were willing to engage in more active, and costly, information-acquisition activities (such as conducting research at the library and attending public meetings). Finally, the model suggests that geographic proximity to nondescript resources may affect nonuse values, information costs, or both, helping define the potentially affected population. The empirical results for the lower Passaic River support this third proposition. The overall conclusion is that only a small fraction of the population in New Jersey and New York might reasonably experience a nonuse loss as a result of industrial water pollution in the lower Passaic River.

Notes: Sustainable development has become the dominant concept in the study of interactions between the economy and the biophysical environment, as well as a generally accepted goal of environmental policy. So far, economists have predominantly applied standard or neo-classical theory to environmental economic problems. In this article it will be argued that to fully understand a transformation of the economic system towards sustainability, standard environmental economics needs to be complemented by an evolutionary approach, that focuses the attention on irreversible, path-dependent change and long-run mutual selection of environmental and economic processes and systems. The article provides an overview of the main existing evolutionary contributions to environmental economics. Furthermore, a number of research directions of an evolutionary approach in environmental economics are discussed. It is suggested that such an approach should go beyond evolutionary theories of technical change, which dominate evolutionary economics so far, by including co-evolution of economy and environment, sustainable consumption, endogenous preference change, and climate change modeling.

Notes: This article offers insights into the identification of cases with a significant potential for ethnic conflict over a 2-3 year time horizon through an examination of the application of the Analytic Hierarchy Process (AHP) to the analysis of ethnic conflict potential in those cases. The goal is to suggest an analytical framework with applicability to the assessment of ethnic conflicts in Southeast Asia and beyond; thus, factors are identified that tend to precipitate or facilitate ethnic conflict in a world dominated by the norms of the modern state system.Twenty-four ethnic minority groups are identified in Southeast Asia that havesome potential for conflict over the next 2-3 years. The AHP methodology is then employed as a means to measure the potential for ethnic conflict among these twenty-four groups. Potential is defined as the product of desire or motivation to act (i.e., the motivating factors) and the ability or capability to act (i.e., the enabling conditions), such that: POTENTIAL = (MOTIVATION) X (ABILITY). This approach to ethnic conflict analysis promotes consideration of the contextual factors that influence feelings of marginalization and capacity to effect change—a considerable step forward over approaches that are based on (inevitably problematic) generalizations about the shared attributes or historically rooted prejudices toward ethnic groups.

Notes: Past attempts to uncover evidence that economically disadvantaged groups are unjustly exposed to environmental disamenities have failed to take into account self-selection behavior of individuals or groups of individuals. For instance, when choosing a place to live, households may be trading environmental quality for other housing, neighborhood, and location characteristics they care about. Previous literature on environmental justice has investigated location choice of polluting industries, but fails to account for consumer self-selection in housing markets. This paper thus focuses on location choice of individuals based on observed housing transactions. From the results of a random utility model, a test is proposed that incorporates the no-envy concept of economic equity. The results support a finding for environmental discrimination with respect to African American households, but do not support the hypothesis that poor households in general are unfairly exposed to environmental disamenities.

Notes: Books reviewedMoazzem Hozzain, Iyanatul Islam and Reza Kibria, South Asian Economic Development:Transformation, Opportunities and Challenges,Valentine Udoh James and James S. Etim, (eds.) The Feminization of Development Processes in AfricaAura Reggiani, (ed.) Accessibility, Trade and Locational BehaviourRichard H. Olson and Thomas A. Lyson, (eds.) Under the Blade: The Conservation of Agricultural Landscapes

Notes: Shift-share analysis is used to examine the role of spatial structure on changes in regional manufacturing employment, in contrast to the traditional focus of shift-share studies on the role of industrial structure. It is argued that changes in a region's space-economy can be understood not only in terms of the economic subdivisions of the region but also in terms of the contribution of its spatial subdivisions. The latter is illustrated by means of a case study of the contribution of different types of local area to changes in regional manufacturing employment in Japan. Each region was subdivided into four types of local area based on population density. The analysis covered the period from 1981 to 1995, a time of major transformation in Japan's space-economy. The shift-share model was also used to estimate the impact of local area output and productivity on changes in regional employment. In general, the results show that there was a progressive underdevelopment of the core regions, associated with falling output and productivity. The country's peripheral regions were characterized by development, associated with rising output and productivity. Atthe local scale, however, the picture is far more complex. Types of local area contributed to regional employment change in very different ways, with respect to both time, region, and output/productivity. The contribution of local spatial structure to the regional space-economy of Japan is fundamentally fragmented and uneven.

Notes: To assess development potential of small business, this research examines the age and size characteristics of nonmetropolitan firms and the contribution of business ‘births,’‘deaths,’ expansions, and contractions to job growth. Analysis of data derived from the federal-state unemployment insurance program in Georgia indicates that firms employing fewer than 100 workers account for 44.3 percent of private sector nonfarm employment in nonmetropolitan counties. Overall, the mix of small and large firms remained quite stable over the five year study period. The dynamics of job creation and loss differed dramatically by enterprise size and manufacturing/nonmanufacturing sector. Three segments of the business population contributed most to rural job growth: very small continuing firms, large manufacturing establishments, and non-manufacturing businesses owned by large enterprises. The paper concludes with a discussion of economic development policies that may enable rural communities to capitalize on these business demographic trends.

Notes:   Over the last two decades many European governments have pursued ambitious research and development (R&D) policies with the aim of fostering innovation and economic growth in peripheral regions of Europe. The question is whether these policies are paying off. Arguments such as the need to reach a minimum threshold of research, the existence of important distance decay effects in the diffusion of technological spillovers, the presence of increasing returns to scale in R&D investments, or the unavailability of the necessary socio-economic conditions in these regions to generate innovation seem to cast doubts about the possible returns of these sort of policies. This paper addresses this question. A two-step analysis is used in order to first identify the impact of R&D investment of the private, public, and higher education sectors on innovation (measured as the number of patent applications per million population). The influence of innovation and innovation growth on economic growth is then addressed. The results indicate that R&D investment, as a whole, and higher education R&D investment in peripheral regions of the EU, in particular, are positively associated with innovation. The existence and strength of this association are, however, contingent upon region-specific socio-economic characteristics, which affect the capacity of each region to transform R&D investment into innovation and, eventually, innovation into economic growth.

Notes:   In the international business literature location behavior has traditionally been analyzed using Dunning's (1977) OLI framework, which focuses on the nature, role, and behavior of multinational enterprise (MNE). In this paper it is argued that this approach is now no longer appropriate for discussing the spatial behavior of MNEs, because of the fundamental changes which have taken place either in MNE organization or in the global and institutional environment for foreign direct investment (FDI). At the same time, the paper argues that current location theory from regional economics and economic geography is also largely unsuitable for discussing these issues, such that the spatial behavior of the MNE provides a set of difficult challenges to location analysts. There appears to have been some response to these issues from the international business and management literature, most notably the Porter literature on clusters. However, it is also argued here that this literature provides few, if any, real answers to the problems set by the geographical behavior of the MNE. It is concluded that a fusion of traditional economic geography approaches with a focus on the information and organizational aspects of the firm and the region under consideration may be a way forward for both theory and empirical analysis.

Notes:   This paper documents the investigation of the impact of metropolitan structure on the commute behavior of urban residents in the Netherlands. Not only has the impact of monocentrism versus polycentrism been analyzed, but the influence of metropolitan density and size has also been considered, together with the ratio of employment to population and the growth of the population and employment. Furthermore, data are used at a variety of levels of analysis ranging from the individual worker to the metropolitan region rather than being drawn from aggregate level statistics alone. Multilevel regression modeling is applied to take account of the interdependencies among these levels of aggregation. With regard to mode choice, the results indicate that the probability of driving an auto to work is lower in employment-rich metropolitan regions, and rises as the number of jobs per resident has grown strongly. Furthermore, women in most polycentric regions are less likely to commute as an auto driver. All else being equal, commute distances and times for auto drivers are longer in most polycentric regions than in monocentric urban areas. In addition, commute time as an auto driver rises with metropolitan size, whereas commute distance depends on employment density and the growth of the number of jobs per resident. The investigation shows that metropolitan structure, although significantly influencing commute patterns, explains only a small part of the variation of individuals’ commute behavior.

Notes:   Economic competitiveness now has less to do with new materials than with new ways of producing, utilizing, and combining diverse knowledges. It is branded as symptomatic of a “new” economy and is often juxtaposed against the “old” economy. As accelerating technological change has greatly increased the volume and quality of the information available to organizations, to firms, and to individual employees, it is asserted that the economy has become more “new” than “old.” But this is predicated on the assumption that there is a “new” economy and that it is somehow distinguishable from the “old.” This paper explores the basis for this dichotomy and whether it really adds anything to understanding contemporary economies and their ongoing development. It will be argued that it is more useful and constructive to examine the economy through a lens dominated by service industries that are now the key drivers of change (innovation, competition, employment) and development. The paper is concluded with a discussion of some items that could usefully be part of an agenda for further research by economic geographers on the evolving spatial and structural attributes of service work and organizations and their impact on cities or regions at different scales of analysis.

Notes: This paper explores possible ways in which growth in Internet retailing (e-retailing) may affect the spatial distribution of economic activities. After a brief overview of e-retailing, a categorization of possible spatial impacts is introduced. These include impacts on the retail industry, such as substitution of e-retail for brick-and-mortar retail, impacts on transportation, such as substitution of freight transportation for personal transportation in goods delivery, and pervasive impacts that affect the whole economy. The latter category includes uniform delivered pricing, spatial leveling of accessibility, and marketing strategies that target individuals rather than regions. The question of whether e-retailing and brick-and-mortar retailing are truly substitutes is taken up in the next section, along with potential implications of multi-channel retailing. The final section of the paper defines some critical research directions.

Notes: Logistics chains are constantly changing to facilitate increasingly global movements. In qualitative terms, long term trends in logistics services indicate a growing degree of product customization and an increased responsiveness in order delivery. These trends impact on the development of technology and the growth of welfare in different world regions in different ways. This paper drafts a research agenda which will help to improve understanding of the interrelationships between trade, logistics, transport, and regional development at a global scale. Rather than being an exhaustive or detailed inventory of trends, the paper provides a focus on “supply chain by thinking.” The key starting point is the need for more and more efficient transportation and sophisticated logistics processes. Three subjects are treated: First, the strategic implications of borderless supply chain management on the choice of alternative logistics structures in supply chains are considered; second, the possible impacts of the expected changes in supply chain processes upon regional economic activities are examined; third, the impacts of changes in global logistic processes on the transportation system and, in turn, on the environment are explored. This discussion leads to the identification of some new research challenges in the field of transportation and logistics.

Notes: The question “Will using Information and Communication Technology (ICT) systems enable a more sustainable mobility?” is answered through analyzing current ICT policy in the EU and the United States of America (USA), through developing a conceptual model to structure the expected direct and indirect effects of ICT systems on mobility, and through building models for three selected ICT systems to estimate their quantitative effects on mobility. Based on the models, ICT systems seem to have limited mobility reduction potential (in terms of CO2 emissions and kilometer savings). On the short term, because of efficiency gains, ICT systems have a positive impact. In the long term, better quality of mobility will attract new demand and this will again result in an increase of travel. For policymakers this implies that ICT systems in the short run can make mobility more efficient. In the long run, to prevent the more efficient mobility from attracting new traffic, the implementation of any ICT system should be accompanied by a stronger pricing policy.

Notes: Although many studies have investigated how poor health affects hours of work and labor force participation, few have examined the extent to which individuals adapt in order to remain in the labor market. Individuals experiencing health problems may move to different types of work in order to remain in the labor force or to reduce the negative labor market consequences of illness. This paper investigates the movement between employers, and among occupation categories when changing employers, using data from the Health and Retirement Study (HRS). One advantage of the HRS is that its questions on life-cycle employment and health patterns permit a long-term perspective on job mobility that is unavailable in most other datasets. Workers with health problems are more likely than healthy workers to remain with their current employer than to switch employers. But among those who switch employers, those with health problems are more likely to change broad occupational categories than are healthy workers. While many individuals remain with the same employer after the onset of health problems, many do switch employers and occupations, even in the presence of ADA legislation.

Notes: This paper examines how the presence of dual, disparate environmental disamenities located near each other impact property values in a semi-rural area. A heavy metals manufacturing facility and a rubber-compounding factory operate two and one half miles apart in a small community. The heavy metals manufacturing facility uses low-level depleted uranium in its production. The level of production is small and the production process does not emit visible air pollution or odors that can be easily identified. Thus, if the surrounding community negatively perceives a potential risk, it is not through the channels of sight or smell. The rubber-compounding factory emits foul odors and some visible air pollution. Thus, its negative externalities and potential risks are easily perceptible. Using the hedonic price technique, this paper examines the impact of the use of a non-perceptible hazardous material in the production of a good on housing prices in a community when another more visible, noxious facility is present. The results show that noticeable disamenities are capitalized into housing values, while non-visible ones are not.

Notes: The e-economy is part of a larger phenomenon, technocapitalism, that is transforming business organizations and the ways in which they transact, produce, and ship their goods. Technocapitalism is an evolution of market capitalism that is rooted in technological innovation and supported by such intangibles as creativity and knowledge. This paper considers first the main characteristics of networks that support the e-economy and its source phenomenon, the emergence of technocapitalism. Networks are thought to be the main vehicle through which the e-economy spreads, and they have major effects on the organization of business firms. The culture of technocapitalism, with its emphasis on continuous innovation and rapid adjustment, is largely behind the rising importance of networks. A second section then considers the deconstruction of business firms and its relation to networks, the e-economy, and the rise of technocapitalism. A historical perspective is provided to show the contrast with previous eras. The deconstruction of business organizations involves a major transformation of the norms and ways in which firms are run and structured. Finally, the likely implications for transportation and shipping of the rise of the e-economy, its networks, and the deconstruction of firms are discussed. The logistics, pricing, and infrastructure of shipping are likely to be substantially affected by the spread of the e-economy, its networks, and the deconstruction of firms.

Notes: This paper presents a critical survey of some recent developments in the theory of international trade. Particular emphasis is given to the role of increasing returns to scale and labor mobility in shaping the pattern of industrial location across integrating countries. The goal is to review and discuss the novel insights and predictions of the so-called “new” theories in order to pose and stimulate avenues for future research.

Notes: Land-use and -cover change is a topic of increasing concern as interest in forest and agricultural land preservation grows. Urban and residential land use is quickly replacing extractive land use in southern Indiana. The interaction between land quality and urban growth pressures is also causing secondary forest growth and forest clearing to occur jointly in a complex spatial pattern. It is argued that similar processes fuel the abandonment of agricultural land leading to private forest regrowth, changes in topography and land quality, and declining real farm product prices. However, the impact of urban growth and development on forests depends more strongly on changes in both the residential housing and labor markets. Using location quotient analysis of aggregate employment patterns, and the relationship between regional labor market changes, the extent of private forest cover was examined from 1967 to 1998. Then an econometric model of land-use shares in forty southern Indiana counties was developed based on the net benefits to agriculture, forestland, and urban uses. To test the need to control explicitly for changes in residential demand and regional economic structure, a series of nested models was estimated. Some evidence was found that changing agricultural profitability is leading to private forest regrowth. It was also uncovered that the ratio of urban to forest land uses is better explained by incorporating measures of residential land value and industrial concentration than simply considering population density alone.

Notes: Abstract This paper analyzes the productivity growth of the Spanish regions between 1965 and 1995, decomposing productivity gains into technological progress and efficiency change by means of Malmquist indices. Once estimates of efficiency are obtained, the aim of this paper is to analyze the effects of human and public capital on growth in terms of their impact on Total Factor Productivity (TFP). Public capital is believed to increase the productivity of the private factors of production whereas human capital is thought to contribute to the production process as an additional input and to have a dynamic influence on growth through its impact on technological innovation (shifts in the production frontier) and technological diffusion (movements toward the frontier), which are the components of this TFP measure. Considering inefficiencies will then allow the effects of these variables on TFP growth to be estimated via technological progress and efficiency gains.

Notes: Abstract A consistent gap exists between home Internet use in metropolitan areas and in non-metropolitan areas in the U.S. This digital divide may stem from technology differences in home Internet connectivity. Alternatively, differences in education, income, and other household attributes may explain differences in metropolitan and non-metropolitan area home Internet access. Effective programs to reduce the metropolitan–non-metropolitan digital divide must be based on an understanding of the relative roles that technology and household characteristics play in determining differential Internet usage. The household Internet adoption decision is modeled using a logit estimation approach with data from the 2001 U.S. Current Population Survey Internet and Computer Use Supplement. A decomposition of separate metropolitan and non-metropolitan area estimates shows that differences in household attributes, particularly education and income, account for 63 percent of the current metropolitan–non-metropolitan digital divide. The result raises significant doubts that policies which focus solely on infrastructure and technology access will mitigate the current metropolitan–non-metropolitan digital divide.

Notes: Networks of interaction have assumed particular significance in recent years because of their presumed importance for learning and innovation. Alliances between related firms are thought to encourage interactive learning between participating organizations through the sharing of knowledge and information, which is itself facilitated through trust, shared values and ways of working. The vast body of literature that has emerged is, however, incredibly fragmented, encompassing an array of theoretical positions and perspectives. This paper focuses upon two issues which are believed to be of particular significance and which need clarification in order to move to a clearer understanding of the ways in which networks of interaction evolve, and of their capabilities and limitations in relation to economic performance and competitiveness: (1) the importance of network structure, arguing that innovative activity requires flexibility with regard to network formation. (2) The role of geography in relation to the construction and functioning of alliances. It is the contention here that networks are likely to be increasingly international in scope.

Notes: The capabilities of central office (CO) telephone switches in four southeastern states (Kentucky, Mississippi, North Carolina, and Tennessee) provide detail on spatial variation in telecommunications technologies. A proposed six-level hierarchy of switch capability was used. Switches with digital capability are concentrated disproportionately in metropolitan areas, largely in response to larger numbers of business establishments. The overall picture in the Southeast is one of tremendous variation—variation across states and variation within the four states being studied. Rural (nonmetro) counties generally, but not always, have both fewer switches overall and fewer switches with digital capability. North Carolina and Tennessee, the two most urban of the four states, also have seen the greatest entry by new telecommunications competitors. These two states have the largest percentages of advanced (digital) switches in both metro and rural counties. At the county level, the number of switches is primarily a function of a county's population but, even more significantly in three states, of the number of business establishments in the county. On the whole, it is residents of metropolitan—not rural—areas who are most likely to be served by newer forms of digital telecommunications.

Notes: Despite the prevalence of multiple jobholding, there is relatively little research into its causes. Existing research has tested the predictions of standard labor models with micro data. Yet, there has been virtually no research into the relationship between moonlighting and structural differences in regional labor markets such as wages and employment growth. In this manner, this study examines the large differences in multiple jobholding rates across U.S. states. The findings indicate that multiple jobholding acts as a short-term shock absorber to cyclical changes. However, in the long-term, these effects dissipate, indicating that moonlighting plays a similar role as do changes in unemployment and labor-force participation to regional labor market shocks. Conversely, multiple jobholding rates are inversely related to average weekly earnings. Thus, job growth accompanied by real wage (and productivity) growth may result in a decline in multiple jobholding, further exacerbating potential labor shortages. Other key factors found to influence multiple jobholding include occupational structure and education.

Notes: Many researchers and practitioners agree that evaluation of economic development planning programs is important, although the perspectives on the approaches, methods, and use of results vary widely. Confounding the issue are cases in which development programs have a small number of participants and typical measures such as parametric statistics are not valid. The alternate evaluation technique presented here uses a non-parametric approach, incorporating a control group for comparison purposes. The paper begins with a review of evaluation issues for economic development planning programs, followed by an illustration of the approach suitable for programs with small numbers of participants. It utilizes a case study of a publicly-funded small business incubator program, the Advanced Technology Development Center, located in Atlanta, Georgia. By explaining how the analysis is constructed and the results interpreted, the paper illustrates a potentially useful methodological approach to evaluating community economic development programs.

Notes: The industrial rise of the Third Italy has been characterized by the growth of dynamic networks of flexible small and medium–sized enterprises (SMEs) that are spatially concentrated in specialized industrial districts. This network type of coordination has been associated with horizontal, trust–based relations rather than vertical relations of power and dependency between local organizations. This would lower transaction costs (essential for local systems with an extreme division of labor), facilitate the transmission and exchange of (tacit) knowledge (and thus, learning and innovation), encourage cooperation mechanisms (such as the establishment of research centers), and stimulate political–institutional performance (e.g. through regulation of potential social conflicts).From an evolutionary perspective, the focus is on the dynamics of industrial districts drawing from current experiences in Italy. In this respect, this paper concentrates on two main features of industrial districts that have largely contributed to their economic success in the past, that is, their network organization and the collective learning process. The evolution of industrial districts is described in terms of organizational adjustments to structural change. The way in which the size distribution of firms has changed is discussed (in particular the role of large companies), how the (power) relationships between local organizations have evolved, what are the current sources and mechanisms of learning, and to what extent institutional lock–in has set in. Finally, a number of trajectories districts may go through in the near future are presented.

Notes: State governments offer a variety of programs to assist technology intensive entrepreneurial firms yet there is a limited understanding of how firms use these programs. This paper provides a framework for categorizing state technology programs and uses detailed case studies to examine how these programs augment firms’ capabilities. It is concluded that firms made extensive use of state programs that provide access to university intellectual property and research facilities. In addition, firms participated in programs that provided incentives for faculty to conduct joint research with industry. Finally, state venture capital programs, though small relative to federal R&D grants or venture capital, appear to nurture firms’ development.

Notes: This paper proposes an evolutionary reading of rural development referred to cases of rapid industrial growth, where a strong concentration process has involved the main urban centers and the successful industrial districts. This territorial development pattern has gradually extinguished rural society and its institutional basis, creating a clear separation between new central and peripheral areas. The consequent effects on local economy and social dynamics reveal the long-term risks raised in terms of development sustainability. An empirical study of two Italian provinces is also carried out to show how this framework can be helpful in interpreting real historical patterns.

Notes: After a long period of industrialization based on import substitution (ISI), Mexico started to open up its economy by accessing the General Agreement on Tariffs and Trade (GATT) in 1986. The export-promotion strategy was transformed into one of regional integration with the signing of the North American Free Trade Agreement (NAFTA) in 1994. The paper explores the impact of the opening of the economy on regional disparities in Mexico using σ and β-convergence analyses. Four different samples have been employed to control for possible data bias linked to the inclusion of oil-producing and maquiladora-based states. The results show that whereas the final stages of the ISI period were dominated by convergence trends, trade liberalization (GATT) and economic integration (NAFTA) have led to divergence. In particular, the NAFTA period is related to divergence regardless of the type of analysis chosen and the sample used.

Notes: Books reviewed:R. D. Norton, Creating the New Economy: The Entrepreneur and the US ResurgenceMay T. Yeung, Nicholas Perdikis, and William A. Kerr, Regional Trading Blocs in the Global Economy: The EU and AseanYair Aharoni and Lilach Nachum, (Eds.) Globalization of Services: Some Implications for Theory and PracticeAmy K. Glasmeier, Manufacturing Time: Global Competition in the Watch Industry 1795–2000

Notes: Differential rates of growth and decentralization are processes that characterized U.S. urban areas over the past three decades. This paper examines the determinants of growth in cities and suburbs during the 1970s, the 1980s, and the 1990s. The modeling approach adopted in the study allows for simultaneity between population and employment, and between cities and suburbs, while also taking into account a range of other explanatory factors. Results indicate that population and employment growth in cities tend to be jointly determined, but that growth of employment in the suburbs tends to drive growth of suburban population. Results also suggest that suburban and city growth are interrelated, but that the nature of these interrelationships varies over time: suburban growth promoted city growth during the 1970s and 1980s, while city and suburban growth were jointly determined during the 1990s. Other factors that consistently explain variation in city growth include demographics, population density, crime rates, and income inequality. Factors consistently explaining suburban growth include regional location and climate.

Notes: Over the past one and a half decades, smaller cities and nonmetropolitan areas in Mexico have attracted manufacturing plants, led by the export manufacturing sector. Maquiladoras in particular are increasingly locating their plants in such places in the “deep interior” Mexico—outside of the border states. Using 1980 and 1990 Mexican census data for 19 growth centers and 27 high-emigration municipios (counties) in Central Mexico, this paper suggests that foreign-owned assembly (maquiladora) jobs decentralized significantly over the 1980s, locating closer to emigrant municipios. An examination of 17 emigrant municipios in the industrialized states of Jalisco and Guanajuato found that an emigrant municipio's accessibility to maquiladora jobs, and jobs indirectly related to maquiladora growth, was positively related to its overall employment growth, which was, in turn, negatively related to its U.S. migration rate over the decade. Although the migration reduction inherent in these relationships is relatively small, it could be accelerated by U.S. and Mexican policies giving incentives for more peripheral locations of export-oriented and other manufacturing.

Notes: While public goods can provide an overall increase in welfare, ‘inferior’ public facilities produce externalities specifically impacting host locations. Heterogeneous jurisdictional attributes, however, can cause net social benefits to vary across potential host communities. Using data from a unique public works project, this paper empirically investigates whether policymakers consider heterogeneous conditions when locating prison facilities. Results indicate that policymakers follow a process that maximizes net social benefits by systematically delegating such facilities to lagging communities; thereby potentially using the public facilities for economic development. Additionally, results suggest that policymakers properly consider existing infrastructure and agglomeration economies in the siting mechanism.

Notes: This paper looks at the role of firm size, location, and in-house research and development (R&D) in the innovation performance of U.S. firms in the commercial geographic information systems (GIS) industry. Data from a survey of 300 GIS firms are presented. The results suggest that innovation-intensity varies directly with in-house R&D spending (scaled as a proportion of company sales), but inversely with company size (total employment). Significant regional variations in the innovation performance of GIS firms are identified. It is argued that the geography of innovation is influenced by the spatial distribution of young and/or small firms, in that R&D-productivity is found to vary inversely with company size. An important finding is that creative inputs to support innovation are almost evenly divided between internal and external sources. A surprising result is that the academic community is not viewed as a particularly important source of new ideas for innovative firms. The paper concludes with a discussion of the implications of the survey data for future empirical work on the GIS sector.

Notes: This paper develops a two-sector endogenous growth model with a dual labor market caused by the operation of trade unions. Trade unions strive for the extraction of rents from the growth generating imperfectly competitive primary sector. This union behavior results in a non-competitive wage differential between the primary and secondary (perfectly competitive) sector. How the relationship between growth and unemployment depends on the institutional details of the labor market is analyzed. In general, growth and unemployment are intimately related for two reasons. Unemployment affects the scale of operation of the economy and thereby the growth rate. Growth affects inter-temporal decisions of workers about where to allocate on the labor market once they are laid off, and thereby it affects equilibrium unemployment.

Notes: Changes in Income Inequality within U.S. Metropolitan Areas. By Janice F. Madden.Modern Political Economy and Latin America: Theory and Policy. Edited by Jeffry Frieden, Manuel Pastor Jr., and Michael Tomz. Latin America Transformed: Globalization and Modernity, edited by Robert N. Gwynne and Cristobál Kay. Bidding for Business. The Efficacy of Local Economic Development Incentives in a Metropolitan Area. by John E. Anderson and Robert W. Wassmer.

Notes: Using data for U.S. metropolitan statistical areas, an earlier study of aggregate local geographic research spillovers generated by universities (Anselin et al.1997) was extended to a sectorally disaggregated level. These findings suggest the existence of significant sectoral variation with respect to local university effects on innovation. Apparent differences were found across sectors with respect to the “mix” of applied local knowledge inputs in general, and the extent to which university research plays a role in innovation in particular. The main conclusion is that local university spillovers seem to be specific to certain industries, such that at the two-digit SIC level, no university spillover effects are at work in the Drugs and Chemicals (SIC28) and in the Machinery (SIC35) sectors. On the contrary, very strong and significant university research spillovers are evidenced in the Electronics (SIC36) and the Instruments (SIC38) industries. These spillovers extend beyond the boundary of the MSA within a 75-mile range from the central city.

Notes: Governments frequently formulate policies designed to stimulate regional economic development. Rarely, however, are efforts made to measure local preferences for economic development outcomes. While the political process should eventually sort out how well local governments are meeting the needs of their constituents, the irreversible nature of many development outcomes makes it preferable to incorporate local preferences directly into the decision making process. This paper presents a straightforward means of measuring preference trade-offs. The analytical hierarchy procedure is applied to local economic development outcomes in three Virginia counties and is shown to improve the targeting of industries by incorporating local preferences in the targeting process. The method has wide applicability for different development decisions.

Notes: The quality of public schools is often cited as an important attribute which distinguishes a community. Indeed, a recent public opinion poll conducted by the California Public Education Partnership indicates that residents rank improvements in public education higher than such high profile issues as environmental quality and crime reduction. In order to explore the role of educational quality in determining residential property values, a hedonic housing price model is used on a large sample of homes which sold within Fresno County in California over the period 1990-1994. After controlling for a wide range of housing characteristics and neighborhood features, the findings indicate that the school district does significantly influence the real sale price. Then the relative importance of inputs into the production of educational services is investigated as compared to output measures of productivity. These findings suggest that both input and output measures are important. However, elasticity estimates of input measures tend to be higher than those of output measures, with the average class size by far the strongest influence. There is some evidence to suggest that the benefits of additional teachers likely outweigh the costs. Finally, the findings suggest that attributes of schools are more highly valued by local residents than either crime or environmental quality measures within the community.

Notes: This study examines convergence in real wages for hired farm labor in the U.S. agricultural sector over the period 1978-92,using the ‘average farm’ in each county as an observation. Convergence is investigated at the aggregate (or the entire U.S. level)and regional levels. Evidence supports convergence with a slower rate at the aggregate level than that at the regional level. Suggested by the evidence is the possibility that absolute benefits of wage equalization across states are ‘contagious’—that one state's successful investment raises productivity and factor payments in neighboring states and that agricultural labor markets are efficient and integrated all over the country.

Notes: This paper examines the relationship between environmental policy and growth, from the perspective of endogenous growth theory. In particular three standard endogenous growth models are supplemented with environmental issues, such as pollution and exhaustibility of natural resources. It is found that these new elements may affect the long run growth rates, but this is not a universal outcome. One consequence for economic policy is that optimal taxation to realize a social optimum should take account of environmental issues.

Notes: This paper looks at the linkages between three recent developments in spatial economics that in combination have changed the way that economic growth is viewed. These new approaches are that of the New Growth Theory, the measurement of geographical economic convergence, and the role of infrastructure in stimulating economic growth. In combination these developments may combine to provide a different perspective on why regions often grow at differential rates,ways of measuring these differences, and possible policy interventions tomanipulate geographical variations in the growth process. The paper argues, however, that these concepts, while they may offer new insights, are nevertheless unlikely to provide a complete picture of why spatial economic divergence is widespread nor a set of policy instruments that can be simplydeployed to ameliorate such discrepancies.

Notes: Books reviewed:John Helliwell, How Much do National Borders Matter?A. McLaughlin and W. Maloney, The European Automobile Industry: Multi-level Governance, Policy and Politics

Notes: The traditional empirical approaches to the analysis of economic growth,cross-section and panel data regressions are substantially uninformative withrespect to the issue of convergence. Whether national or regional economies appear to converge in terms of per capita income or productivity levels (the so-called β-convergence) critically depends on the way in which the empirical model is specified. Traditional specifications witness a disproportionate presence of proxies for forces leading towards divergence among the conditioning variables. It is therefore hardly surprising that these analyses find a positive and statistically significant value for the estimate of the speed of convergence.A more constructive use of cross-section and panel data regressions is in the analysis of the determinants of growth. The present paper therefore builds on recent work on the role of different growth determinants (Cheshire and Carbonaro 1996) and analyses the growth performance of 122 Functional Urban Regions (FURs)over the period 1978–1994. This model explicitly recognizes growth as amultivariate process. In this new formulation it incorporates a spatialized adaptation of Romer's endogenous growth model (Romer 1990), developing the work of Magrini (Magrini 1997). Magrini's model originated from the view that technological knowledge has a very important tacit component that has been neglected in formal theories of endogenous growth. This tacit component, being the non-written personal heritage of individuals or groups, is naturally concentrated in space. As a result, technological change is profoundly influenced by the interaction between firms and their local environments.The present paper reports the results of the estimation of a fully specified model of regional growth in per capita income. Particular attention is played to the role of research and development (R&D) activities, and to the influence of factors such as Universities that shape the local environments and have important policy implications.These results are then applied to quantifying the scope for policy to influence the growth process. Several simulations are presented deriving alternative growth outcomes across European regions that would have been obtained if those variables over which policy might have control—including the contribution of human capital—had had alternative values reflecting the realistic scope of policy makers' influence. The implications for convergence/divergence in regional per capita income levels are then analyzed using a Markov chain approach (Quah 1993 and 1996; Magrini 1999).

Notes: Book reviewed:P. Rietveld and D. Shefer, (eds.) Regional Development in an Age of Structural Change

Notes: The potential interactions among governmental policies, investments andeconomic growth are complex and manifold. This paper will perform a systematic comparative analysis of the various economic insights that are currently available on these complex relationships, both theoretically (by a selective literature review) and empirically (by reviewing the empirically obtained insights). Despite the wide variety of potential theoretical relationshipsbetween government expenditures, taxation and growth, most empirical analyses are restricted to simple linear regressions of growth on some measure of government expenditures. We will indicate directions for future empirical research that may enrich our knowledge about the complex relationship between fiscal policies and economic growth, not only nationally but also regionally.

Notes: The hedonic price method is used to estimate the relationship between residential property values and airport noise and proximity to the airport in the Reno-Sparks area. Empirical results suggest there is a statistically significant negative relationship between airport noise and residential property values, with the average home in areas where noise levels are 65 decibels or high selling for about $2400 less than equivalent homes in quieter areas. However, in direct contrast to the study by Tomkins et al.(1998) who found proximity to the Manchester airport to be an amenity, this study finds proximity to the Reno-Sparks airport to have a significant negative value.

Notes: Books reviewedKarl A. Fox, Urban-regional Economics, Social System Accounts, and Eco-behavioral Science: Selected WritingsJames G. Gimpel, Separate Destinations: Migration, Immigration and the Politics of PlacesJeffry Frieden, Manuel Pastor Jr. and Michael Tomz (eds.), Modern Political Economy and Latin America: Theory and Policy

Notes: This paper examines the relationships between ethnicity and regional economic transformation in Slovakia. It takes as its focus the position of the Hungarian minority in Slovakia in the uneven process of regional change. The paper places these issues within the context of struggles over ethnicity and ‘nation’ in post-independence Slovakia. The paper argues that ethnicity has been a thoroughly contested issue since the collapse of ‘communism’ in Slovakia and a variety of struggles have been waged over enhancing the rights and position of the Hungarian minority population. The concentration of the Hungarian minority in the southern Slovak border regions with Hungary is examined within the context of the uneven economic impacts of the ‘transition to capitalism’. It is argued that, while the economic decline seen in many of these ‘Hungarian’ regions has impacted negatively on the local populations, the roots of these changes lie within the ways in which such regions were integrated into the state socialist regional division of labor. In particular, the role of peripheral industrialization in such regions prior to 1989, in attempting to reduce economic differences among various ethnic groups, resulted in the establishment of branch plant economies which have had difficulty in surviving since 1989. It is therefore the interweaving of the economics of regional decline and the politics of ethnicity that help us to understand the complex place of the Hungarian minority in Slovakia.

Notes: Among the most destructive legacies of apartheid in South Africa is the violent history of division, discrimination, and control through which the everyday injustices of racial order were experienced. This violence of ‘separate development’ was inscribed within particular spaces, as the apartheid state attempted to define and control where racially-defined citizens could live, work, and travel. This paper examines the geography of violence and reconstruction in one such space, that of Cato Manor near Durban. The area is known for the large-scale forced removals which took place there in the 1950s, destroying a multi-racial community of Indian and African residents. Although zoned for white residence, Cato Manor remained vacant until the 1980s, when it became a safe haven for refugees fleeing violence in the Natal countryside. In the early 1990s, the area became the focus of a non-racial development effort, which sought to overcome the violent social divisions of the apartheid era. This redevelopment, however, became a site of contestation when former residents of Cato Manor petitioned to reclaim land they once owned there, claims that the city of Durban attempted to nullify in court. The outcome of the land claims trial highlights the tensions between the present dictates of development and the process of negotiating the violence of the past, and suggests that the democratization of planning can be a means of ‘working through’ the legacies of displacement and dispossession that are so much a part of South Africa's present.

Notes: Regionalism has commonly been expected to dissolve as a consequence of the administrative regional penetration of the centralized modern state and the homogenizing forces associated with modernization. This mode of reasoning has reappeared recently among authors who see globalization as a universal force that will eradicate regional economic inequalities, local identities and regional political mobilization. Contrary to these expectations, regional autonomy movements continue to play a central political role within many states. Consequently, it remains an important analytical challenge to understand the construction and politicization of regional interests.Against this background, the article presents a critical interpretation and contextual analysis of Tamil separatism in Sri Lanka. It is argued that studies of nationalist movements should seek inspiration in the contemporary dialog between three main perspectives on social movements (theories of new social movements, resource mobilization theories, and theories of collective identity) and a corresponding three-dimensional understanding of place (location, locale, and sense of place). The paper shows how nationalist mobilization cannot be reduced to essentialist notions of primordial nations, territorial nation-states, or internal colonialism, but instead should be understood as the outcome of cultural and political practices by a multitude of actors, operating in time- and place-specific contexts.

Notes: National policydecisions in developing countries contribute to the increasing integration of agriculture into national and world economies. The spatial consequences of national policies, however, vary across regions and agricultural systems. Employing and adapting a methodology first proposed by King (1970), this study explores the relationship between national policy, agriculture, and population characteristics at the regional level in Mexico during the presidency of Carlos Salinas de Gortari (1988–94). Statistical analyses corroborate the hypothesis that the impact of policy reforms on the agricultural sector in Mexico is mediated by the characteristics of the population. Results suggest that government credit for agriculture and federal funding of rural development during the Salinas de Gortari administration were mediated by factors associatedwith the level of urbanization. The provision of commercial credit at the regional level, however, does not appear to depend on population characteristics. Disparities in the impact of national policies are attributed to a historical urban bias, the differential ability of more highly urbanized states to attract government funding, manage and implement programs, and the existence of highly profitable, commercial agriculture in more developed states.

Notes:   The consequences of the heavy inflow of foreign talent for U.S. scientists and engineers over the period 1973-1997 are examined using data from the Survey of Doctorate Recipients. Of particular interest is whether non-citizens trained in the United States have displaced citizens from jobs in science and engineering (S&E). Using a novel adaptation of the shift-share technique, it is shown that citizen S&E doctorates have fewer jobs in S&E and fewer academic jobs than their non-citizen counterparts for two reasons: the citizen doctoral population has experienced slower growth than the non-citizen doctoral population, and citizen S&E doctorates have been displaced. Whether the displacement observed was a voluntary response of citizens to the lure of better opportunities elsewhere or an involuntary response indicative of having been pushed out by foreign talent remains to be determined.

Notes:   Both economic and demographic contexts influence aggregate migration streams at the regional scale. The influence of demographic and economic context on aggregate migration at the nonmetropolitan scale, however, remains unstudied. This paper presents analysis based on 1980 and 1990 Public Use Microdata Sample (PUMS) data related to age cohort effects on nonmetropolitan population change. The analysis provides enhanced understanding of how demographic factors like the baby boom might influence population movements into and out of nonmetropolitan regions. Using modified age-cohort decomposition techniques, the analysis demonstrates how the fluctuations in nonmetropolitan population growth between 1975 and 1990 are tied to the differential migration flows of the peak baby boom years (those born between 1955 and 1964). The analysis further demonstrates how fluctuations in nonmetropolitan population growth across regions are tied to migration flows of these baby boomers. Significant variation remains within regions.

Notes:   Portes and Borocz's (1989) segmented assimilation framework argued that the assimilation of immigrants into American society does not necessarily or automatically lead to similarity and equality with the mainstream culture. Instead, endowed human capital, the nature of immigration, and reception contextualize the process and potentially lead to differential outcomes. Recognizing that spatial differences in assimilation may also exist, the segmented assimilation framework is extended within this paper to include a more explicit recognition of geography's role in shaping the assimilation trajectory. The empirical analysis draws upon the 1980 and 1990 PUMS data files, and compares the assimilation trajectory of Chinese immigrants (excluding Hong Kong and Taiwanese origins) across the New York, San Francisco, and Los Angeles metropolitan areas. Based upon period of arrival and age in 1980 and 1990, measures of assimilation are compared across these three metropolitan areas, along with the role of internal migration in maintaining or decreasing assimilation differences. The analysis indicates that the progress of assimilation varies significantly over space, with spatial differences in measures of assimilation persisting over time, despite the role of internal migration. Reasons as to why this occurs are presented in the conclusion.