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Space and technology in catching-up economies: “the city as a laboratory for innovation”

Author

Listed:
  • Yong Jin Kim

    (Ajou University)

  • Chul-In Lee

    (Seoul National University)

Abstract

Successful catching-up economies tend to exhibit a set of properties: (i) rapid increases in skilled labor and R&D investment, (ii) industrial structure upgrading from technology adoption toward technology creation sectors, and (iii) spatial concentration on the rise. The paper accounts for them by combining the mechanisms of skill-city complementarity and knowledge spillover in the setting of catching-up economies where ideas are more challenging to find along the growth path. With the diminishing possibility of adopting existing ideas, catching-up economies gradually rely more on creating ideas, which requires efficient knowledge spillover through urban spatial concentration based on ability sorting. We highlight that (i) catching-up economies choose proper city size and structure to benefit from growth effects through fostering innovation and spillovers, and (ii) rents here are not just an economic rent but play a productive role of allocating innovative abilities over space in an incentive-compatible manner. We discuss the policy on urban rents.

Suggested Citation

  • Yong Jin Kim & Chul-In Lee, 2024. "Space and technology in catching-up economies: “the city as a laboratory for innovation”," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 73(1), pages 205-239, June.
    • Handle: RePEc:spr:anresc:v:73:y:2024:i:1:d:10.1007_s00168-024-01257-2
    DOI: 10.1007/s00168-024-01257-2
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    More about this item

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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