IDEAS home Printed from https://ideas.repec.org/p/ehl/lserod/2040.html
   My bibliography  Save this paper

Spatial determinants of productivity: analysis for the regions of Great Britain

Author

Listed:
  • Rice, Patricia
  • Venables, Tony

Abstract

This paper uses NUTS3 sub-regional data for Great Britain to analyse the determinants of spatial variations in income and productivity. We decompose the spatial variation of earnings into a productivity effect and an occupational composition effect. For the former (but not the latter) we find a robust relationship with proximity to economic mass, suggesting that doubling the population of working age proximate to an area is associated with a 3.5% increase in productivity in the area. We measure proximity by travel time, and show that effects decline steeply with time, ceasing to be important beyond approximately 80 minutes.

Suggested Citation

  • Rice, Patricia & Venables, Tony, 2004. "Spatial determinants of productivity: analysis for the regions of Great Britain," LSE Research Online Documents on Economics 2040, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:2040
    as

    Download full text from publisher

    File URL: http://eprints.lse.ac.uk/2040/
    File Function: Open access version.
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Ciccone, Antonio & Hall, Robert E, 1996. "Productivity and the Density of Economic Activity," American Economic Review, American Economic Association, vol. 86(1), pages 54-70, March.
    2. Ciccone, Antonio, 2002. "Agglomeration effects in Europe," European Economic Review, Elsevier, vol. 46(2), pages 213-227, February.
    3. Bernard, Andrew & Redding, Stephen & Simpson, Helen & Schott, Peter, 2002. "Factor Price Equalization in the UK?," CEPR Discussion Papers 3523, C.E.P.R. Discussion Papers.
    4. Bernard Fingleton, 2003. "Increasing returns: evidence from local wage rates in Great Britain," Oxford Economic Papers, Oxford University Press, vol. 55(4), pages 716-739, October.
    5. Edgar S. Dunn, 1960. "A Statistical And Analytical Technique For Regional Analysis," Papers in Regional Science, Wiley Blackwell, vol. 6(1), pages 97-112, January.
    6. Henderson, J V, 1974. "The Sizes and Types of Cities," American Economic Review, American Economic Association, vol. 64(4), pages 640-656, September.
    7. Combes, Pierre-Philippe & Duranton, Gilles & Gobillon, Laurent, 2008. "Spatial wage disparities: Sorting matters!," Journal of Urban Economics, Elsevier, vol. 63(2), pages 723-742, March.
    8. Masahisa Fujita & Paul Krugman & Anthony J. Venables, 2001. "The Spatial Economy: Cities, Regions, and International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262561476, December.
    9. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    10. Stuart S. Rosenthal & William C. Strange, 2003. "Geography, Industrial Organization, and Agglomeration," The Review of Economics and Statistics, MIT Press, vol. 85(2), pages 377-393, May.
    11. Esteban, J., 2000. "Regional convergence in Europe and the industry mix: a shift-share analysis," Regional Science and Urban Economics, Elsevier, vol. 30(3), pages 353-364, May.
    12. Redding, Stephen & Venables, Anthony J., 2004. "Economic geography and international inequality," Journal of International Economics, Elsevier, vol. 62(1), pages 53-82, January.
    13. Moretti, Enrico, 2004. "Human capital externalities in cities," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 51, pages 2243-2291, Elsevier.
    14. Deichmann, Uwe & Henderson, Vernon, 2000. "Urban and regional dynamics in Poland," Policy Research Working Paper Series 2457, The World Bank.
    15. Wheaton, William C. & Lewis, Mark J., 2002. "Urban Wages and Labor Market Agglomeration," Journal of Urban Economics, Elsevier, vol. 51(3), pages 542-562, May.
    16. Bernard Fingleton, 2001. "Equilibrium and Economic Growth: Spatial Econometric Models and Simulations," Journal of Regional Science, Wiley Blackwell, vol. 41(1), pages 117-147, February.
    17. Rosenthal, Stuart S. & Strange, William C., 2004. "Evidence on the nature and sources of agglomeration economies," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 49, pages 2119-2171, Elsevier.
    18. Patricia Rice & Anthony Venables, 2003. "Equilibrium Regional Disparities: Theory and British Evidence," Regional Studies, Taylor & Francis Journals, vol. 37(6-7), pages 675-686.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Giordano Mion & Paolo Naticchioni, 2009. "The spatial sorting and matching of skills and firms," Canadian Journal of Economics, Canadian Economics Association, vol. 42(1), pages 28-55, February.
    2. Combes, Pierre-Philippe & Duranton, Gilles & Gobillon, Laurent, 2008. "Spatial wage disparities: Sorting matters!," Journal of Urban Economics, Elsevier, vol. 63(2), pages 723-742, March.
    3. Stephen J. Redding, 2010. "The Empirics Of New Economic Geography," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 297-311, February.
    4. William C. Strange, 2009. "Viewpoint: Agglomeration research in the age of disaggregation," Canadian Journal of Economics, Canadian Economics Association, vol. 42(1), pages 1-27, February.
    5. Pierre-Philippe Combes & Gilles Duranton & Laurent Gobillon, 2011. "The identification of agglomeration economies," Journal of Economic Geography, Oxford University Press, vol. 11(2), pages 253-266, March.
    6. Combes, Pierre-Philippe & Gobillon, Laurent, 2015. "The Empirics of Agglomeration Economies," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 247-348, Elsevier.
    7. Stephen J. Redding, 2013. "Economic Geography: A Review of the Theoretical and Empirical Literature," Palgrave Macmillan Books, in: Daniel Bernhofen & Rod Falvey & David Greenaway & Udo Kreickemeier (ed.), Palgrave Handbook of International Trade, chapter 16, pages 497-531, Palgrave Macmillan.
    8. Steven Brakman & Harry Garretsen & Charles Van Marrewijk, 2009. "Economic Geography Within And Between European Nations: The Role Of Market Potential And Density Across Space And Time," Journal of Regional Science, Wiley Blackwell, vol. 49(4), pages 777-800, October.
    9. Rosenthal, Stuart S. & Strange, William C., 2008. "The attenuation of human capital spillovers," Journal of Urban Economics, Elsevier, vol. 64(2), pages 373-389, September.
    10. Henry Overman & Patricia Rice & Anthony Venables, 2010. "Economic Linkages across Space," Regional Studies, Taylor & Francis Journals, vol. 44(1), pages 17-33.
    11. Gilles Duranton, 2007. "From cities to productivity and growth in developing countries," Working Papers tecipa-306, University of Toronto, Department of Economics.
    12. Combes, Pierre-Philippe & Lafourcade, Miren & Thisse, Jacques-François & Toutain, Jean-Claude, 2011. "The rise and fall of spatial inequalities in France: A long-run perspective," Explorations in Economic History, Elsevier, vol. 48(2), pages 243-271, April.
    13. Ahlfeldt, Gabriel M. & Feddersen, Arne, 2010. "From Periphery to Core: Economic Adjustments to High Speed Rail," MPRA Paper 25106, University Library of Munich, Germany.
    14. Neil Foster & Robert Stehrer, 2009. "Sectoral Productivity, Density and Agglomeration in the Wider Europe," Spatial Economic Analysis, Taylor & Francis Journals, vol. 4(4), pages 427-446.
    15. Fu, Shihe, 2007. "Smart Cafe Cities: Testing human capital externalities in the Boston metropolitan area," Journal of Urban Economics, Elsevier, vol. 61(1), pages 86-111, January.
    16. Rosa Sanchis-Guarner, 2012. "Driving Up Wages: The Effects of Road Construction in Great Britain," SERC Discussion Papers 0120, Centre for Economic Performance, LSE.
    17. Kristian Behrens & Frédéric Robert‐Nicoud, 2009. "Krugman's Papers in Regional Science: The 100 dollar bill on the sidewalk is gone and the 2008 Nobel Prize well‐deserved," Papers in Regional Science, Wiley Blackwell, vol. 88(2), pages 467-489, June.
    18. Behrens, Kristian & Robert-Nicoud, Frédéric, 2008. "Survival of the fittest in cities: agglomeration, selection, and polarisation," LSE Research Online Documents on Economics 28506, London School of Economics and Political Science, LSE Library.
    19. Stef Proost & Jacques-François Thisse, 2019. "What Can Be Learned from Spatial Economics?," Journal of Economic Literature, American Economic Association, vol. 57(3), pages 575-643, September.
    20. Börjesson, Maria & Isacsson, Gunnar & Andersson, Matts & Anderstig, Christer, 2018. "Agglomeration, productivity and the role of transport system improvements," Working papers in Transport Economics 2018:16, CTS - Centre for Transport Studies Stockholm (KTH and VTI).

    More about this item

    Keywords

    regional disparities; productivity; clustering;
    All these keywords.

    JEL classification:

    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ehl:lserod:2040. See general information about how to correct material in RePEc.

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

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

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

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: LSERO Manager (email available below). General contact details of provider: https://edirc.repec.org/data/lsepsuk.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.