Location Of Economic Activity Research Articles

Place-based policies and geographical inequalities

Abstract Place-based programmes have become an important form of government intervention with the potential to profoundly affect the location of economic activity, along with the wages, employment, and industry mix of communities and regions. The enormous social costs of concentrated poverty and unemployment suggest that forms of policy intervention that can reduce concentrated poverty and unemployment have enormous upsides. At the same time, place-based policies involve important trade-offs. The main source of the trade-offs stems from the fact that place-based policies seek to shift investments, jobs, and incomes from the most productive areas of a country towards the least productive areas. This can result in economically meaningful efficiency losses. Setting socially optimal place-based policies crucially depends on understanding the sources of geographical disparities and the trade-offs involved.

Micro-scale transformations in sustainability practices: Insights from new migrant populations in growing urban settlements

Development that is inclusive and sustainable requires significant social and environmental transformations from current trajectories, building on demographic realities such as changing profiles of populations, and increased levels of mobility. Migration is a major driving force of urbanisation in all global regions, partly facilitated through emerging technologies and declining costs of movement and communication. Social transformations associated with increased migration are highly uneven but include shifts in the location of economic activities, major urban growth, and changing individual incentives and social constraints on sustainability trajectories. Yet, there is limited empirical evidence on how observed population movements can both challenge and promote sustainable transformations. This paper examines how migration transforms places and societies, by providing new evidence on the behaviours and practices of individuals who are part of such transformations as they assimilate, converge or remain distinctive to prior populations. Focusing on individuals in rapidly expanding cities in the Global South, this study uses new biographical life-history survey data from Accra, Ghana, to examine the barriers and enablers of sustainability practices among diverse types of migrants and a sample of non-migrants. The study uses data from 1,163 individuals: international migrants from the West African sub-region (559), internal migrants (299), and non-migrants (305) in Accra. The findings show that sustainability practices established before migration are predictors of current sustainability practices, including proactive recycling, conservation activities, and choice of mode of transportation, but that there is some convergence between behaviours, reflecting assimilation, place attachment and other factors. Internal migrants in Accra exhibit stronger sustainability practices than international migrants. Individual levels of poverty, poor infrastructural development, and perceptions about life satisfaction in the neighbourhood negatively affect sustainability practices among all respondents. These results suggest that poverty and social exclusion are critical to addressing sustainability issues in urban contexts. It is important for policy makers to address issues of urban poverty, cumulative deprivation, and inequality as strong barriers to the adoption of sustainability practices in urban areas.

Impact of Round-tripping FDI on Tax Avoidance of Enterprises

As a part of enterprise strategy, round-tripping FDI has a far-reaching impact on tax avoidance. Enterprises aim to minimize the tax burden by redistributing capital, optimizing the global business structure and adjusting the location of economic activities. This strategic choice has spawned a variety of complex mechanisms in the international tax environment, and its influence involves tax competition, tax evasion theory, transfer pricing and intellectual property rights on a global scale. These incentives can attract enterprises to bring their overseas profits back to their home countries by reducing their operating costs and improving their competitiveness, thus achieving economic growth and increasing employment opportunities. Generally speaking, the impact of round-tripping FDI on corporate tax avoidance is reflected in many levels. By optimizing the global business structure, flexibly using intellectual property rights and adjusting the transfer pricing strategy, enterprises skillfully use the international tax environment to maximize economic benefits. At the same time, the state provides positive support for enterprises through economic incentives, which reduces the tax burden of enterprises in the domestic economy and promotes the development and innovation of domestic industries.

The Economic Consequences of Political Hierarchy: Evidence from Regime Changes in China, 1000–2000 C.E.

AbstractWe study how political hierarchy shapes regional development in China, using variations driven by regime changes during the 1000–2000 C.E. period. We find that changes in the status of the provincial capital led to the rise and decline of different prefectures as measured by population and urbanization. Two other novel findings stand out: (1) the economic advantages of the provincial capitals did not persist if they lost their political status, and (2) political hierarchy shaped economic development not only through public employment but also through the development of important infrastructure, such as transportation networks. Our findings highlight the importance of politics in determining the locations of economic activities.

High-Skill Migration, Multinational Companies and the Location of Economic Activity

Abstract This paper aims to understand the relationship between high-skill immigration and multinational activity. I assemble a novel firm-level dataset on high-skill visas and show that there is a large home bias effect: foreign multinationals hire more immigrants from their home countries than from other origins. I then build and estimate a quantitative model that relates multinational production with immigration. First, I impose a restrictive immigration policy in the US and evaluate how it affects production and wages. Second, I increase the barriers to multinational production and show that immigration is an important channel to quantify the welfare gains generated by multinationals.

Risk exposure factors influencing the frequency of road crashes during the COVID-19 pandemic in Ciudad Juarez, Mexico. A negative binomial spatial regression model

The article aims to investigate the influence of risk exposure factors on the frequency of road crashes from January to August 2020 in Ciudad Juarez, Mexico. It is a longitudinal study with four data sets: road crashes, population and housing census, location of economic activities, and road network information. Specifically, this study investigates the relationship between exposure factors – demographics, main roads and land use – and road crashes. A mixed method analysis was employed, (1) spatial analysis using GIS techniques; and (2) a negative binomial spatial regression model. The results showed a strong spatial dependence (0.274; p-value 0.00) of road crashes in the census tracts, and this effect was statistically significant (0.007) in the spatial regression model. In the model, a high probability (<0.05) of road crashes in the census tracts was found with the population aged 15 to 65 years, the length of main roads and the level of road coverage (Engel index), land uses with economic activities of an industrial and commercial character. The findings of this study successfully capture the social, economic, and urban conditions during the January–August 2020 period in the context of the COVID-19 pandemic. This new knowledge could help create preventive plans and policies to address the frequency of road crashes.

Colonial Roads and Regional Inequality

This paper examines the effect of road-building on local economic development and regional inequality by studying the effort in the early 20th century to connect all cities and towns in Puerto Rico with roads. Using newly digitized maps, I show that expanding the transport network failed to reduce regional disparities and that areas near old Spanish roads became relatively more prosperous during the export boom that followed annexation by the United States. Instrumental variable and spatial first differences strategies indicate that early access to roads promoted local economic development. Areas that already had access to roads before US-led road-building became more densely populated, specialized more in the production of export crops, and eventually led the transition away from agricultural employment. Those areas are still more prosperous, suggesting that early access to the transport network gave rise to path dependence in the location of economic activity. However, geographical factors and earlier economic development—also likely a product of geography—played a larger role in shaping the spatial pattern of development.

Analysis of The Impact of Space Application Patterns in Placing the Location of Economic Activities Through the Conversion Mechanism of Raw Land Field Land Conversion

Conversion of agricultural land into built-up land is a regional economic development mechanism, where to increase Gross Domestic Product can be done by allocating the widest possible pattern of space designation "industry, trade and settlement", the implication is the conversion of agricultural land into built-up land. land (rice fields) increases and rice production facilities decrease so that food fulfillment is constrained, in other words there is a trade off in the use of paddy fields. In an effort to optimize the allocation of space for rice fields, the purpose of this study is to analyze the factors of space allocation in influencing the location of economic activities (industry and housing) in rural areas. Through the mechanism for conversion of paddy fields and the determination of the priority scale for the revision of the designation pattern of paddy fields in the regional spatial plan. This study uses spatial overlay analysis, quantitative calculations, multiple linear regression and spatial analysis of 4 criteria (space allocation, road access, population density and land prices). The research locations are distinguished in rural areas with high and low industrialization and urbanization. Input data using spatial software with overlay techniques including spatial data on administrative boundaries of the sub-district area, paddy land use in 2013 and 2018, road access (tolls, arteries and collectors) in 2018, spatial allocation based on the Regency Spatial Plan, value zone land in 2018 and population density. The results showed that the location of economic activities (industrial and housing) was relatively influenced by the space allocation factor compared to the road access factor. Revision of Spatial Plan is recommended in rural areas with high rice field conversion potential in rural areas with high industrialization and urbanization.

Mechanism for the Optimal Location of a Business as a Lever for the Development of the Economic Strength and Resilience of a City

Today, the location of a business is more important than ever, as it contributes to its consolidation in the market and, in parallel, to the economic development of a city. Over the years, the theories about the optimal location of a business have undergone various changes, both financial and spatial. On the other hand, economic geography, as a discipline that studies the distribution of economic activities as well as the interactions between them, is also an important tool for the analysis of urban/spatial and business processes. This paper finds the optimal locations of economic activities through the combination of theories of economic geography and spatial analysis, for the sake of reducing urban shrinkage and increasing the resilience of businesses and cities. The analysis of this paper proved that the areas that are most exposed to urban shrinkage are the least central areas. Urban shopping centers, despite the large percentage of closed stores, continue due to their centrality to attracting more new businesses. The calculation of the optimal location of the economic activity showed that the optimal location depends on the financial sector itself but also on the economic activities that open or close over time in this region. In this way, an answer is sought regarding the way in which each region and its economic identity can influence a city’s future development and resilience. Thus, through this analysis, cities are able to control and strengthen their economic landscapes, vulnerable as they are in difficult times, and to implement policies in specific urban units, with a view to the prosperity of their economic activities.

Of Mice and Merchants: Connectedness and the Location of Economic Activity in the Iron Age

Abstract We study the causal relationship between geographic connectedness and development using one of the earliest massive trade expansions: the first systematic crossing of open seas in the Mediterranean during the time of the Phoenicians. We construct a geography-based measure of connectedness along the shores of the sea. We relate connectedness to economic activity, which we measure using the presence of archaeological sites. We find an association between better-connected locations and archaeological sites during the Iron Age, at a time when sailors began to cross open water routinely on a large scale. We corroborate these findings at the world level.

The Economic Consequences of Political Hierarchy: Evidence from Regime Changes in China, 1000-2000 C.E.

Abstract We study how political hierarchy shapes regional development in China, using variations driven by regime changes during the 1000–2000 period. We find that changes in the status of the provincial capital led to the rise and decline of different prefectures as measured by population and urbanization. Two other novel findings stand out: (1) the economic advantages of the provincial capitals did not persist if they lost their political status, and (2) political hierarchy shaped economic development not only through public employment but also through the development of important infrastructure, such as transportation networks. Our findings highlight the importance of politics in determining the locations of economic activities.

Towards a post-COVID geography of economic activity: Using probability spaces to decipher Montreal's changing workscapes.

In March 2020, many workers were suddenly forced to work from home. This brought into stark relief the fact that urban economic activity is no longer attached to specific workplaces. This detachment has been analysed in research on organisations and workers, but has not yet been incorporated into concepts used to document and plan the economic geography of cities. In this article, three questions are explored by way of an original survey: first, how can a shift in the location of economic activity be measured at the urban scale whilst incorporating the idea that work is not attached to a single location? Second, what is the nature of the shift that occurred in March 2020? Third, what does this tell us about concepts that have underpinned the study of urban economic form by geographers and planners? Applying concepts developed in organisation studies and sociology, we operationalise the idea that economic activity happens across multiple spaces: it occurs within a probability space, and since March 2020 it has shifted within this space. To better understand and interpret the longer-term impact of this shift on cities – downtowns in particular – we draw upon interviews with people working from home.

Consumer Mobility, Online and On-site Commerce and the Geographic Concentration of Economic Activity: Evidence from 20 Billion Transactions

The geographical pattern of consumers’ expenditures, whether made on-site or online, has implications for the location of economic activity and regional economic development. Data limitations have however limited our knowledge of this aspect of consumer behaviour. This paper uses transaction data to investigate such geographical patterns, and the impact of online commerce on these and on inter-regional retail trade linkages between cities and regions. We build original mobility and inter-regional retail trade measures from nearly 20 billion domestic consumer transactions made through bank cards, in France 2018-19. We find evidence that online consumer expenditure are more heavily concentrated in the already-large regional economies, relative to on-site expenditure, which suggests that the increasing movement toward online purchasing tend to increase the concentration of overall economic activity, and may have important implications for regional economic development.

Оцінка готовності України до міжнародного автоматичного обміну інформацією в податкових цілях

The implementation of a constituent element of a three-tier model of transfer pricing documentation – a report in the context of the countries of the multinational group of companies – is a prerequisite for Ukraine's joining the Multilateral Competent Authority Agreement as a measure for implementation of Action 13. The Ministry of Finance of Ukraine, together with the State Tax Service of Ukraine, developed a Roadmap on preparation and harmonization of the draft regulatory legal acts necessary to ensure implementation of the Law of Ukraine dated January 16, 2020 No. 466-IX, according to which the development, approval and registration of the regulatory legal acts for the country-by-country reporting and the procedure for filling it out must be completed until November 23, 2020. The purpose of the article is to determine the institutional basis for improving the legislation of Ukraine in the field of international exchange of information for tax purposes, in particular, the development of recommendations and proposals of the OECD in the field of country-by-country reporting of the multinational group of companies. In the course of study, the authors examined the OECD documents that form the institutional basis for the development of methodological and organizational support for reporting in the context of countries. In accordance with Action 13 of the BEPS Action Plan, jurisdictions of the world have undertaken to increase the transparency of taxation by enshrining in law the requirement to disclose information on the general distribution of their income, taxes and other indicators by the location of economic activity of multinational group of companies. The comparative analysis of the termino­logy and content of information to be disclosed in the country-by-country reporting in accordance with OECD documentation and Law № 466-IX shows that there is a discrepancy in terminology, indicators and degree of data disclosure in some indicators.

Investigating functional mix in Europe's dispersed urban areas

A large proportion of European inhabitants live in dispersed urban settlements, much of which is labelled as sprawl, defined by monofunctional, low-density areas. However, there is increasing evidence that this may be an overly simplistic way of describing territories-in-between (TiB). This paper defines and maps functional mix in six dispersed urban areas across Europe, applying a method that goes beyond existing land-use-based mixed-use indicators but considers functional mixing on the parcel level. The paper uses data on the location of economic activities and the residential population. It concludes that, in eight cases from four European countries, mixed-use is widespread and that more than 65% of inhabited areas are mixed. Moreover, the paper relates functional mixing to specific settlement characteristics: permeability, grain size, centrality and accessibility, and connectivity. This demonstrates that functional mixing is not the result of local urban morphology or planning instruments, but of the multi-scalar qualities of a location. Therefore, there is a requirement to coordinate planning and design through different scales if mixed-use areas are to be seen as one strategy for achieving greater sustainability in the spatial development of dispersed areas.

Conceptual Foundations and Empirical Advances of Economic Resilience with Extensions to Complexity, Entropy and Spatial Dynamics

This chapter presents, further clarifies, and extends the foundations of economic resilience, with an eye to concerns of measurement. We examine the potential usefulness of theoretical concepts and empirical analyses in related fields such as ecology, management, regional science, and planning. We contend that there exists no single best approach to defining or measuring resilience across disciplines and that research should evolve to fit specific applications, though adhering to sound principles within each discipline. We illustrate the usefulness of our conceptual foundations in the design of an econometric analysis of economic resilience and summarize its application to survey data from two major disasters. In relation to the themes of this volume, economic resilience can serve to reduce entropy by countering the disarray in an economy in the aftermath of a disaster. At the microeconomic level, this also intersects with complexity in terms of synergies within an individual firm, and at the macroeconomic level manifests itself most notably through supply-chain interactions and network effects. In terms of spatial dynamics, it relates to geographic shifts in the location of economic activity by actual physical relocation of businesses, shifts of activity to branch plants, and the rebalancing of trade across regions.

FACTORS AFFECTING THE LOCATION OF ECONOMIC ACTIVITIES: A MULTI-DISCIPLINARY REVIEW AND CONCEPTUAL FRAMEWORK

A holistic framework that enables a systematic evaluation of the factors affecting the location of economic activities has thus far been lacking. Using a structured review, this research summarises the key developments that address this issue. Based on this review, a conceptual framework is proposed. The framework is location-centric — i.e., it evaluates the performance of a location in supporting a specific activity aimed at a particular market. It aims to assist both firms and policymakers to evaluate the key location determinants that drive the location of activities.

Uneven Regulation and Economic Reallocation: Evidence from Transparency Regulation

We investigate the impact of uneven transparency regulation across countries and industries on the location of economic activity. Using two distinct sources of regulatory variation—the varying extent of financial-reporting requirements and the staggered introduction of electronic business registers in Europe—, we consistently document that direct exposure to transparency regulation is negatively associated with the focal industry’s economic activity in terms of inputs (e.g., employment) and outputs (e.g., production). By contrast, we find that indirect exposure to supplier and customer industries’ transparency regulation is positively associated with the focal industry’s economic activity. Our evidence suggests uneven transparency regulation can reallocate economic activity from regulated toward unregulated countries and industries, distorting the location of economic activity.

Equity analysis in access to Public Transport through a Land Use Transport Interaction Model. Application to Bucaramanga Metropolitan Area-Colombia.

The development of the Bucaramanga Metropolitan Area (BMA) under criteria focused on the expansion of residential and commercial sectors without considering transportation has produced a congested network and an increase in illegal mobility. A solution was articulating the city through Metrolinea Integrated Transport System (MITS) that not represents an optimal solution yet. Users prefer long-lasting trips by car rather than using public transportation. The absence of methods for assessing transportation deficiency in an agile manner more according to dynamic changes does not allow taking optimal decisions promptly. This research proposes a methodology that fuses a transport model using Visum software and a land-use model implemented in the Python language to analyze access to public transportation, i.e., using four integrated sub-models: transport, residential location, location of economic activities, and accessibility. Analysis of global equity using social indexes to measure the level of need for service and infrastructure was key to proper territory modeling. Results not only indicate where MITS is inefficient but also were could be useful to assess future behaviour considering socio-economic variables, land use, and new infrastructure.

Understanding European Economic History: Knowledge, Institutions, and Growth

This book review provides a multi-dimensional discussion on how the text (two editions) delivers not only factual information regarding European economic history, but focuses on the relevance and constructive uses of economic concepts, theories, and statistical analyses on issues regarding industrial economics. One major concern within industrial economics is the failure to recognize past experiences (the importance of history). Accordingly, the book contains a considerable amount of discussion about the problems and changes in the history of economic distribution associated with specific locations of economic activities, income, resources, production, international economic integration, and spatial economic activities in Europe. Furthermore, economic issues related to the international relationship between Europe and some developing countries are also elaborated. This book review serves as more than a summary: it highlights several intellectual and research-oriented aspects of the book that may benefit studies of economic industrialization and the humanities and social sciences more broadly. In particular, several aspects are evaluated, suggesting the extent of its comprehensiveness and the important data provided in the book. Finally, certain differences observed between the first and second editions of the book are also acknowledged and explained.