Sectoral Dimensions Research Articles

Determinants of Singapore’s Outward FDI

Outward foreign direct investment (OFDI) has been an important element in Singapore’s economic strategy since the 1990s, with the government providing direct and indirect support to the internationalization process. Recent OFDI trends indicate that China has become an important destination for Singapore. In ASEAN, Singapore’s main investment markets are Indonesia, Malaysia and Thailand. Singapore’s OFDI has important sectoral dimensions, supported by evidence from econometric analysis. It is also important to distinguish between OFDI stock and flows.

Service branches as activities minimizing wage inequality within European Union

The analysis in the paper is focused on a problem of differences in a level of wages and salaries between EU countries in a sectoral dimension. We try to diagnose a scale of the differentiation and a direction of changes in a period of 2004-2013 years. In a search for the reasons of wage inequality between countries we pay our attention to structural differences in remunerations. We try to specify which branches are the most and which are the least diversified across EU countries in terms of a level of wages and salaries. As modern development is connected with servicisation of economies we try to specify a character of a service sector considering its ability to equalize remunerations. We verify a hypothesis if it covers branches with the lowest level of wage inequality across EU countries. Structure of the paper leads us from a diagnosis of a relative wage level across branches into assessment of wage inequality in different branches across EU countries. In conclusion we confirm the initial thesis and point out at information and communication as well as financial and insurance activities as the ones of the lowest wage inequality

Modern Aspects of Sustainable Development of Russian Industry and Their Reflection in Regional Innovation Clusters

As a result of the executed research it is established that the modern economic policy shall rely on the evidence-based mechanism of a sustainable development of the industry reflecting features of this stage of its development to which first of all it is necessary to refer territorial, industry, innovative and integration aspects. In work these features of implementation of the concept of a sustainable development of the Russian industry in modern conditions are considered. It is revealed that on their crossing modification of production organization, new to Russia, – the territorial innovative clusters (TIC) is created. TIC allow to successfully solve the problem of the highest priority for this area of the industry – «growth poles», thus ensuring the implementation of territorial and sectoral dimensions of sustainable development industry in Russia. Due to the presence of the network structure they allow much faster to develop and implement innovations. The Russian Federation started the process of creating and functioning of regional innovation clusters. It is through these «growth points» should be made a breakthrough in increasing the global competitiveness of the economy through its transition to a new technological base.

Economics of extreme weather events: Terminology and regional impact models

Impacts of extreme weather events are relevant for regional (in the sense of subnational) economies and in particular cities in many aspects. Cities are the cores of economic activity and the amount of people and assets endangered by extreme weather events is large, even under the current climate. A changing climate with changing extreme weather patterns and the process of urbanization will make the whole issue even more relevant in the future. In this paper, definitions and terminology in the field of extreme weather events are discussed. Possible regional impacts of extreme weather events are collected, focusing on European cities. The human contributions to those impacts are emphasized. Furthermore, methodological aspects of economic impact assessment are discussed along a temporal and a sectoral dimension. Finally, common economic impact models are compared, analyzing their strengths and weaknesses.

Global Value Chains: A View from the Euro Area

This paper describes the main features of global value chains (GVC) between the euro area taken as a whole and other large world trade players like the USA, China and Japan, which also operate as monetary unions. In addition, the individual euro area countries' perspective is considered, with a specific focus on intra‐area linkages. The analysis is primarily based on the concept of foreign value added in exports, which is suitable to assess the pervasiveness of GVC. The paper uses the World Input–Output Database and covers the period 2000–2011, giving also some information on the sectoral dimension of production linkages. The paper concludes that GVC are important for the euro area as whole and there has been a rebound since the trade collapse in 2009. Moreover, there is a strong relevance of regional production linkages in Europe, with a large role for Germany and Central and Eastern European countries.

Do the effects of R&D tax credits vary across industries? A meta-regression analysis

This paper presents a survey of the micro-econometric literature on the effects of R&D tax credits on firms’ innovation activities. We focus on one specific aspect that has not received sufficient attention in previous research: the sectoral dimension. Our meta-regression analysis (MRA) sets up a new database collecting a large number of firm-level studies on the effects of R&D tax credits and investigates the factors that may explain differences in the estimated effects that are reported in the literature. The main result of the MRA analysis is indeed that sectors matter. Specifically, the additionality effect of R&D tax credits is on average stronger for SMEs, firms in the service sectors, and firms in low-tech sectors in countries with an incremental scheme. The paper proposes a simple framework to investigate why the innovation and economic effects of R&D tax credits vary across sectors and points out new directions and hypotheses for future research.

Multi-sectoral decomposition in decoupling industrial growth from carbon emissions in the developed Jiangsu Province, China

ICE (Industrial carbon emission) is one of most important sources of anthropogenic carbon emissions. To reduce the carbon emissions, many countries, particularly China, have adjusted their industrial structures and improved energy efficiency. The complete decomposition technique and decoupling method were used to investigate and quantitatively analyze the main factors influencing the energy-related ICE in Jiangsu, the Chinese province with the largest energy consumption and carbon emissions. The importance of the sectoral dimension was taken into account by dividing the industry into three main departments consisting of 38 sub-sectors. The results indicated that the industry of Jiangsu was in a weak decoupling state from 2005 to 2012. The industrial output growth was the biggest driver of the increase in ICE, while energy efficiency advancement was the main cause for the reduction, in a weakening trend. The year of 2008 was an important breaking point when the optimization of industry structure came into play and global financial crisis took place. The biggest dilemma in Jiangsu is heavy industry is still dominant, especially the five sectors of them made the biggest contribution (88.2%) to ICE. Thankfully, there were five manufacturing industries had achieved low carbon economy at various degrees.

Sectoral asymmetries in a small open economy

This paper explores the sectoral dimension of emerging market business cycles by building a two-sector small open economy real business cycle model featuring a working capital requirement, variable capital utilization and imported inputs in production. The primary finding is that the price of imported inputs and nontradable sector productivity are the two most important sources of macroeconomic fluctuations in a typical emerging market economy. Interest rates and the price of imported final goods also play a significant role in driving investment and import fluctuations. The model also produces significant sectoral asymmetry, especially in response to interest rate shocks. Variable capital utilization acts as a strong propagation mechanism.

Narrowing the Gap between China and Japan: Three Dimensions of National Identity and the Korean Factor

AbstractIn 2010–12, Sino-Japanese relations deteriorated without the Yasukuni Shrine or Chinese human rights violations in the forefront. To improve relations, attention should turn to what I label the ideological, sectoral, and horizontal dimensions of a national identity gap between these countries. They have each figured in the decline and offer more promise than the temporal dimension, with its symbols of wartime memories, and the vertical dimension, where sensitive Chinese internal affairs are at stake. The sectoral dimension comprises political, economic, and also cultural national identity, each of which has grown more intense in China, while cultural identity is still a force in Japan. Establishing an East Asian community is now the centerpiece in the hope that the horizontal dimension will be an impetus for mutual understanding, yet the notion of community is repeated with no sign of a shared vision of the outside world, whether the US role or the international arena and regionalism. With South Korea, their partner in trilateralism and North Korea's transformation at the crux of all three of these dimensions, this paper emphasizes the way divergent views of the peninsula keep growing in importance for bilateral relations. It suggests ways to reframe relations through cooperation over Korea. As difficult as Korean relations are for both states, it is a test case for their identity gap.

Productivity Growth across Spanish Regions and Industries: A Production-Frontier Approach

Badunenko O. and Romero-Ávila D. Productivity growth across Spanish regions and industries: a production-frontier approach, Regional Studies. This paper decomposes labour productivity growth into components attributable to technological change, technological catch-up, capital deepening and human capital accumulation. This is done through a production-frontier approach applied to Spanish data disaggregated along regional and sectoral dimensions. It is shown that capital deepening is the primary contributor to productivity growth, closely followed by human capital and technological change; widespread efficiency losses substantially impede productivity growth; productivity convergence is driven by higher efficiency losses exhibited by rich regions; analysis of sectoral data shows marked differences in productivity performance; and aggregate productivity growth is driven by intra-sectoral productivity dynamics rather than by structural change.

Decoupling economic growth from carbon dioxide emissions: A decomposition analysis of Italian energy consumption

Decomposition analysis is used to assess the progress in decoupling Italian economic growth from CO2 emissions. Using the method developed by Sun JW. Accounting for energy use in China, 1980–94. Energy 1998;23:835-49, the main factors that influence the changes in energy-related CO2 emissions are analysed. The study refers to the period 1998–2006, split into two time intervals (1998–2002 and 2002–2006) and considers four explanatory factors: CO2 intensity, energy intensity, structural changes and economic activity. The importance of sectoral dimension is taken into account by dividing the Italian economy into five main sectors: the agricultural; the industrial; the electricity and heat production, water and gas; the transport and the services sectors. An industrial sub-sector decomposition analysis is also performed by considering six industrial branches. It is found that, during the period considered, the Italian economy did not perform absolute decoupling in terms of energy consumption and carbon dioxide emissions and that economic growth and energy intensity are the largest contributors to CO2 emissions increase.

Data Template For District Economic Planning

Defining ‘open data’ to mean insights from accessible data becoming available to elected decision makers within governance as structured inputs, this paper sets out the status in India in a study done in 2008-10 in the case of Madhubani district in the state of Bihar for district economic planning. The paper demonstrates that a large amount of accessible data can generate highly structured inputs, such as village level digital maps and comparative analysis to set out sectoral, temporal and geographical dimensions of the changes in the local economy. It also identifies disconnects within institutional and political functioning of governance that impedes such opening of data to structured decision making in local governance.

Repensando los estudios de sistemas de innovación. El sistema catalán de innovación como lugar estratégico de investigación

The system of innovation or innovation system approach has brought a profound change and improvement in the understanding of the innovation process, mainly by taking into account the national, regional, sectoral and technological dimensions and factors. However, despite its clear knowledge accumulation, it still has analytical limitations with regard to old questions and also to emerging issues. This article looks at the Catalan innovation system, as a strategic research case, in order to point out which are these questions and issues, and to propose some possible ways to advance in the analytical solution, and in general in moving towards a better understanding of the innovation processes in the globalizing capitalism of the 21st century society and economy.

World Trade Competitiveness: A Disaggregated View by Shift-Share Analysis

We develop an improved shift-share methodology and employ it to estimate the trade competitiveness of 88 world countries during the 1995-2002 period and to identify factors that drove each country’s increase or drop in exports market share. Along with the export competitiveness, we consider the geographical and sectoral dimension of countries’ initial position on different import markets and of their capacity to adapt to shifts in the world economy. Differently from the traditional method employed in the literature, our procedure yields identical results regardless the order in which trade is decomposed in geographical and sectoral factors. Moreover, it produces standard errors and permits to evaluate the statistical significance of each effect.During this period, the strong demand for elaborated products has benefited the developed countries and disadvantaged most of the South, especially the least-performing countries. Despite the unfavorable sectoral breakdown of the global import demand, exporters from the South recorded remarkable gains in market share over the 1995-2002 period. The emergence of the South, not just as a supplier of the North but as well as a rapidly expanding market, was mainly driven by Central and East European countries along with Turkey on one hand, and emerging Asian countries on the other hand. These gains are mainly explained by the competitiveness of their exports, which largely compensated for disadvantages linked to their sectoral specialisation. In Latin America, the improvement in competitiveness just offsets the major handicap in sectoral specialisation, without allowing most of the countries to maintain their market share. African and the Middle East countries accumulate both unfavourable sectoral and geographic specialisations, as well as a poor adaptation to the markets’ dynamics.The EU recorded the best performance in the North by maintaining its market share, especially on the domestic market, regardless the emergence of Southern exporters. On the contrary, competitiveness and market share losses by the US and Japan are significant and of similar magnitude. Japanese exports have suffered from the general weakening of the domestic economy, while the high level of the dollar in the beginning of the period has reduced the competitiveness of American products. For both countries, however, such sluggish competitiveness was slightly compensated by other factors: geographical advantages for the US and sectoral advantages for Japan.

China’s provincial CO2 emissions embodied in international and interprovincial trade

Trades create a mechanism of embodied CO2 emissions transfer among regions, causing distortion on the total emissions. As the world’s second largest economy, China has a large scale of trade, which results in the serious problem of embodied CO2 emissions transfer. This paper analyzes the characteristics of China’s CO2 emissions embodied in international and interprovincial trade from the provincial perspective. The multi-regional Input–Output Model is used to clarify provincial CO2 emissions from geographical and sectoral dimensions, including 30 provinces and 28 sectors. Two calculating principles (production accounting principle and consumption accounting principle, Munksgaard and Pedersen, 2001) are applied. The results show that for international trade, the eastern area accounts for a large proportion in China’s embodied CO2 emissions. The sectors as net exporters and importers of embodied CO2 emissions belong to labor-intensive and energy-intensive industries, respectively. For interprovincial trade, the net transfer of embodied CO2 emissions is from the eastern area to the central area, and energy-intensive industries are the main contributors. With the largest amount of direct CO2 emissions, the eastern area plays an important role in CO2 emissions reduction. The central and western areas need supportive policies to avoid the transfer of industries with high emissions.

The impacts of climate change in Europe (the PESETA research project)

How much will climate change damage the European economy? Which geographical areas would be the most affected? Which sectors are most vulnerable? Where and why will there be gains from climate change? How sectoral policies should be changed to consider climate impacts and adaptation? These questions are relevant for designing and prioritising adaptation strategies, as stressed by the European Commission White Paper on Adaptation (European Commission 2009). Within that context, the main motivation of the PESETA research project (Projection of Economic impacts of climate change in Sectors of the European Union based on boTtom-up Analysis) has been to contribute to a better understanding of the possible physical and economic impacts induced by climate change in Europe over the 21st century, paying particular attention to the sectoral and geographical dimensions of impacts (Ciscar et al. 2009; Ciscar et al. 2011a). There are two approaches in the literature used to estimate the economic impacts of climate change. The first approach implements a top-down perspective proposing reducedform damage functions that relate climate variables to a measure of economic impact. The effect of climate change on gross domestic product (GDP) is usually a function of the average global temperature, such as in e.g. Hitz and Smith (2004) and Stern (2007). Yet, this approach has some drawbacks. Firstly, estimates are based on results from the literature, derived from different, and maybe inconsistent, climate change scenarios. Secondly, only average temperature and precipitation are usually included. Other relevant climate variables and the required time-space resolution in climate data are not taken into account. Thirdly, impact estimates lack the necessary geographical resolution for assessing regional impacts and prioritising adaptation policies. A second strand of the literature has followed a bottom-up approach, where the physical effects of climate change are estimated by running high-resolution impact-specific models, Climatic Change (2012) 112:1–6 DOI 10.1007/s10584-011-0336-x

Social Amplification of Risk in the Internet Environment

This article analyzes the dynamic process of risk amplification in the Internet environment with special emphasis on public concern for environmental risks from a high-speed railway tunnel construction project in South Korea. Environmental organizations and activists serving as social stations collected information about the project and its ecological impact, and communicated this with the general public, social groups, and institutions. The Internet provides social stations and the public with an efficient means for interactive communication and an open space for active information sharing and public participation. For example, while the website of an organization such as an environmental activist group can initially trigger local interest, the Internet allows this information to be disseminated to a much wider audience in a manner unavailable to the traditional media. Interaction among social stations demonstrates an amplifying process of public attention to the risk. Analyses of the volume of readers' comments to online newspaper articles and public opinions posted on message board of public and nonprofit organizations show the ripple effects of the amplification process as measured along temporal, geographical, and sectoral dimensions. Public attention is also influenced by the symbolic connotations of risk information. Interpretations of risk in religious, political, or legal terms intensify public concern for the environmental risk.

Physical and economic consequences of climate change in Europe

Quantitative estimates of the economic damages of climate change usually are based on aggregate relationships linking average temperature change to loss in gross domestic product (GDP). However, there is a clear need for further detail in the regional and sectoral dimensions of impact assessments to design and prioritize adaptation strategies. New developments in regional climate modeling and physical-impact modeling in Europe allow a better exploration of those dimensions. This article quantifies the potential consequences of climate change in Europe in four market impact categories (agriculture, river floods, coastal areas, and tourism) and one nonmarket impact (human health). The methodology integrates a set of coherent, high-resolution climate change projections and physical models into an economic modeling framework. We find that if the climate of the 2080s were to occur today, the annual loss in household welfare in the European Union (EU) resulting from the four market impacts would range between 0.2-1%. If the welfare loss is assumed to be constant over time, climate change may halve the EU's annual welfare growth. Scenarios with warmer temperatures and a higher rise in sea level result in more severe economic damage. However, the results show that there are large variations across European regions. Southern Europe, the British Isles, and Central Europe North appear most sensitive to climate change. Northern Europe, on the other hand, is the only region with net economic benefits, driven mainly by the positive effects on agriculture. Coastal systems, agriculture, and river flooding are the most important of the four market impacts assessed.

QUANTIFYING KNOWLEDGE SPILLOVERS USING SPATIAL ECONOMETRIC MODELS

This paper seeks to develop our understanding of the somewhat diffuse nature of technological externalities and space by associating a geographical dimension with the sectoral dimension. Using a panel data set containing French patents as well as private and public research expenditures by industry and region over the period from 1992 to 2000, this paper estimates a knowledge production function. The region- and industry-specific nature of the sample data allows us to empirically examine spatial spillovers associated with public and private research expenditures in own- and other-industry sectors for our sample of 94 French regions. We find that the largest direct and indirect effects are associated with private R&D activity that spills across industry boundaries. However, since Jacobs externalities decrease more drastically with distance than MAR externalities, our results also point to different optimal strategies for regional versus national officials.

India-ASEAN Free Trade Agreement: A Sectoral Analysis

This study investigates the sectoral dimensions of India–ASEAN Free Trade Agreement as a result of tariff liberalization. This study reveals that both India and ASEAN gains in terms of welfare while a term of trade for India deteriorates. The present study reveals that processed food products, grain crops, textile and wearing apparel, light manufacturing and heavy manufacturing sectors are expected to be affected significantly and differently. However, results indicate a surge of ASEAN’s exports of processed food items, agricultural products and fisheries which might have adverse impact on employment and wages of Indian working class. This study also revealed that the present FTA will have adverse impact on trade balance and the revenue losses for India which might affect public health, education and government procurement holding for a significant share of national budgets having multiple development dimensions.