Spatial Economics Research Articles

On the Spatial Dimension of General Equilibrium

Problems related to the spatial aspects of economic development are considered within the framework of such scientific disciplines as "regional economy", "spatial economy", "new economic geography", "theory of international trade" mainly from the point of view of partial analysis. The article proposes a "basic model" designed to integrate the spatial dimension into the theory of general equilibrium in relation to a simple exchange economy. Its analysis shows why the choice by economic agents of the place of residence and production activities is as important as the selection of the field of specialization. Key modifications in the functional relationships of the main economic variables linked to the spatial dimension of economic activity are formulated. At the same time, it is shown that the effects of the social division of labor, identified using the "basic model", are potential, since the model ignores huge transaction costs that inevitably accompany the interaction of partially rational economic agents. That is why anchoring in space of the place of transactions, which is the result of experience, becomes a natural way of adapting institutional conditions to the real abilities of economic agents to receive and process information. And these adjustments, in turn, lead to changes in the toolkit of the market mechanism – in particular, adding to it rent by location.

The Long-run Impacts of Transportation Improvements : Spatial Economic Approach Based on Quantitative Spatial Economics

The Long-run Impacts of Transportation Improvements : Spatial Economic Approach Based on Quantitative Spatial Economics

КОНКУРЕНТОСПОСОБНОСТЬ РЕГИОНА КАК ОСНОВА ИННОВАЦИОННОГО РАЗВИТИЯ ПРОСТРАНСТВЕННОЙ ЭКОНОМИКИ

The article considers the main aspects of the formation of spatial economy based on the innovative development of regions, the main components of the federal policy of regional development and the components of the innovation system within the framework of the formation of the structure of the spatial economy, the main incentives contributing to the development of cooperation in the innovation sphere, as well as factors determining regional competitiveness.

Territorial organization of innovative development: Entrepreneurial aspect of sustainability

The article is devoted to the research of scientific issues related to acceleration of innovative development of spatial economy, the provision of the theoretical basis for the formation of zones of innovation growth of individual territories (regions). The degree of influence of innovations on the nature of the territorial organization of economic activity determines the level of well-being in society. The purpose of the study was to identify the features and contradictions of the current state of the system of territorial organization of innovation activity. The issue of diffusion of innovation has been studied in terms of representing and positioning a separate territory (region) as a subject of economic relations, a multifunctional and multi-faceted economic system, but not as a place of concentration of means of pro-duction and labor. The further development, the symbiosis of the regionalism the-ory, in particular the spatial organization of production, along with the theory and practice of innovative entrepreneurship, is the substantiation of creation and de-velopment of the territorial poles of innovation growth. It is proved that the effi-cient innovation policy in a certain economic space of activity should be based on the functional properties of the forms of spatial organization of production on the one hand, and the placement of productive forces, on the other hand. The idea of the nature and character of the existing forms of modern territorial organization of innovation activity embedded in a kind of network design, which is the projection of production networks in a certain territory, or so-called "place-connected net-works", is explored and developed.

Институциональная инфраструктура пространственно-хозяйственных образований Арктики

An important problem of the impact of institutional infrastructure on the decomposition and spatial development transformation of regions of various hierarchical ranks, including the Arctic zone that is divided between the Arctic countries according to the national principle, is insufficiently studied. The majority of scientific works devoted to this issue mostly focus on the traditional economic assessment of the sectoral effect of activities and the concept of spatial economics. Thus, methodological approaches to the study of infrastructure and institutional structure should not rely on the traditional principles of mainstream economics. Instead, they should be based on the system-evolutionary model of modern natural science and should be closely related to such an indicator of system development as self-organisation. Internal (endogenous) and external (exogenous) elements of infrastructure cause stability (order) and chaos (disorder) in the development of systems, as well as lead to the interrelated and balanced formation of hierarchical and heterarchical organisational models of regional spatial units. This methodological approach also applies to institutional infrastructure. The present study provides theoretical justifications and methodological approaches corresponding with the aforementioned principles of infrastructure research, designed for the regions of the Arctic basin. In terms of scientific practice, it is proved that the intensification of institutional infrastructure in the Pacific Arctic depends on the creation of the Russian-American Bering/Pacific-Arctic Council (BPAC). Various expert communities discussed these proposals at several international conferences. At present, however, their practical implementation became impossible due to complicated geopolitical situation. Despite this, it is necessary to continue research aimed at the improvement of institutional structures and coordination of interactions between the Arctic regions, especially in cross-border areas of neighbouring countries. The obtained findings will definitely be useful for the Arctic community, when a reasonable approach to this problem will again prevail over geopolitical disputes.

Modeling the relationship between utilities and partners

The purpose of the article is to study the features of modelling the relationship between utilities and partners. Methodology. General scientific methods are used in the research, in particular, generalizations, comparisons – to analyse the views of scientists on modelling the relationship between utilities and partners, indicating the main forms of public-private partnership, the advantages and disadvantages of their use. Results. It is proved that the relationship between the state and business today is extremely strategically important for the state in the formation of sustainable development goals. Building effective relationships in housing and communal services will be a success for effective activities and will satisfy all participants: the state, business and the population. It is proved that in modern conditions, housing and communal services is a complex hierarchical system that combines many separate subsystems and has the characteristics of a spatial economy, i.e. regional structure and scale. The analysis of the legal and regulatory framework shows that there are only three players in the market of housing and communal services: managers, service providers and consumers. Also, there are various opportunities to establish partnerships with most existing stakeholders, including the use of public-private partnerships in housing and communal services. It is investigated that among the widespread variants of private capital raising in the communal sphere the following basic forms are identified: contract for works, contract for enterprise management, lease, concession, privatization. Thus, local public authorities have the opportunity to transfer utilities in concession or lease to private investors. However, this has not become a common practice due to the complexity of their organizational mechanism. Practical meaning. It is proved that the most effective form of public-private partnership for housing and communal services is a concession – the process of granting, in order to meet public needs by an authorized executive body or local government, concluding a contract on a paid and fixed basis, the concessionaire ) management of the concession object, on the terms of property liability by the concessionaire and possible division of business risk. Prospects for further research. The need to study the advantages and disadvantages of other forms of public-private partnership in housing and communal services.

Fiscal Transfers in the Spatial Economy

Many countries shift substantial public resources across jurisdictions to mitigate spatial economic disparities. We use a general equilibrium model with multiple asymmetric regions, labor mobility, and costly trade to carve out the aggregate implications of fiscal transfers. Calibrating the model for Germany, we find that transfers indeed deliver smaller disparities across regions. This comes at the cost of lower national output, however, because economic activity is diverted away from core cities and toward remote areas with low productivity. But despite this loss in output per capita by about 2 percent in our baseline specification, welfare still increases by 0.07 percent because the transfer scheme countervails overcongestion in large cities. If the optimal transfer regime was implemented, welfare would increase by 0.06 percent. (JEL H77, J61, R12, R13, R23)

On the Evolution of Hierarchical Urban Systems in Soviet Russia, 1897–1989

One piece of evidence of the inefficiency of the spatial economy of modern Russia presented in the seminal work of Hill and Gaddy (2004) is that Russian urban agglomerations are non-viable. This was demonstrated using Zipf’s rank-size distribution, which does not hold for Russian urban systems. Hill and Gaddy explained this through the legacy of the Soviet command-administrative planning. Having constructed an original dataset, which incorporated comprehensive historical data for all the cities in the former Soviet Union republics and tested the rank-size distributions for the respective years, the study yielded more nuanced findings. First, unlike the modern Russian hierarchical urban systems, the Soviet ones followed rank-size distribution fairly well. Second, the Soviet urban systems were evolving. In the late Imperial era and early Soviet period, they followed the Zipf’s law prediction. However, between 1939 and 1959, the rank-size distribution diverged from the predicted one. Yet again, the Soviet hierarchical urban systems revealed a trend of convergence toward the traditional rank-size distribution in the late Soviet era. A corollary to such evidence from data trajectory appears that the evolution of the Soviet hierarchical urban systems was not necessarily the ultimate product of the urban development policies of the command-administrative system. It can be thus presumed that, contrary to the established belief, command administrative urban development might be ineffectual even in centrally planned socialist economies.

Linking spatial economics and sequencing economics for the Osaka tourism agglomeration

AbstractAn agglomeration is an organization composed of its segments such as infrastructure and institutions. Sequencing economics discusses the sequential process analysis of building the segments of an agglomeration. The concept of ‘economies of sequence’ can be defined as the selection of any two segments from among the set of segments of an agglomeration and the sequencing of the segments toward the efficient building of an agglomeration. A central place theory in spatial economics gives the initial conditions of sequencing the segments of the tourism industry agglomeration as the economies of sequence. Using Proposition 1 in Henkel et al. (2000) and analyzing the corollary of the proposition additionally, we interpret our results obtained from Granger causality testing. The corollary is that a symmetric equilibrium is more likely to become unstable and break when substitutability between differentiated goods and transport costs becomes sufficiently low. The first priority in the order of the sequencing of segments in a tourism industry agglomeration is thereby given to those of low transport costs and substitutability between differentiated goods. We find that the first priority segment is Universal Studio Japan to lower the degree of substitutability between the differentiated goods and that the second is Kansai International Airport to reduce transport costs.

Geospatial Data Analysis and Economic Evaluation of Companies for Sustainable Business Development—An Interdisciplinary Teaching Approach

Sustainable business development is connected with environmental impact, natural resources and people. This makes the location a crucial factor for the operation of a business. Therefore, a combination of both geo-spatial data analysis and traditional economic evaluation of companies are advantageous. The consideration of geolocation is beneficial with calculations for process optimizations and cost efficiency as well as ecological and social compliance. Since integrating geospatial methods into economics is a rather new interdisciplinary approach, it seems necessary to establish innovative teaching concepts for the education of experts in this field. Creating and testing such new teaching concepts based on playful learning is the idea behind the ERASMUS+ project SPATIONOMY (“Spatial exploration of economic data—methods of interdisciplinary analytics”). An interdisciplinary team of teachers educates an interdisciplinary assembled group of international students. Hence, the fields of economics/business informatics and geography/geomatics are represented by participants and staff. Based on initial lessons about basic knowledge in the connected subjects, the central elements of the teaching concept are case studies and a simulation game, each with interdisciplinary challenges. The principal aim of the project—to educate students to become specialists in spatial economics—could be achieved. This paper aims to present, evaluate and discuss the methodological approach as well as the results from the application of the simulation game. The results show that the gamification of education is worthy. Simulation game-based learning appears to be more playful and experiential compared to traditional teaching approaches. Further research in this area should focus on the students’ engagement evaluation and attitude towards sustainable behaviour in their own business.

The Impact of Inter-City Traffic Restriction on COVID-19 Transmission from Spatial Econometric Perspective

The aim of this paper is to conduct a spatial correlation study of virus transmission in the Hubei province, China. The number of confirmed COVID-19 cases released by the National Health and Construction Commission, the traffic flow data provided by Baidu migration, and the current situation of Wuhan intercity traffic were collected. The Moran’s I test shows that there is a positive spatial correlation between the 17 cities in the Hubei province. The result of Moran’s I test also shows that four different policies to restrict inter-city traffic can be issued for the four types of cities. The ordinary least squares regression, spatial lag model, spatial error model, and spatial lag error model were built. Based on the analysis of the spatial lag error model, whose goodness of fit is the highest among the four models, it can be concluded that the speed of COVID-19 spread within a certain region is not only related to the current infection itself but also associated with the scale of the infection in the surrounding area. Thus, the spill-over effect of the COVID-19 is also presented. This paper bridges inter-city traffic and spatial economics, provides a theoretical contribution, and verifies the necessity of a lockdown from an empirical point of view.

Spatial Economy Approach to Assess The Effectiveness of Poverty Treatment Policy Models and Regional Economic Impacts

Poverty in Indonesia is still a major problem in national development. Therefore, poverty is still a top priority program that must be carried out by various regions in Indonesia. Various models of regional policies have been created to promote poverty alleviation. This study aims to evaluate and analyze the poverty alleviation policy model that has been carried out by the Sumedang Regency Government and the Magelang Regency Government and its impact on the socio-economic sector through a spatial approach. The research was carried out with a qualitative descriptive method using secondary data derived from official government documents covering poverty alleviation policies and their performance achievements. This study is able to show a scientific deepening of the form of poverty reduction supported by the sensitivity of regional policies to provide space in the process of spatial-based regional economic development. The results of this study present a partial spatial strategy that must be carried out, including agricultural intensification from the small farming sector, the development of a more dynamic commercial agriculture sector, providing growth stimulation in the non-agricultural rural sector, shifting the productive age population and providing a safety net for those trapped in poverty. poverty as an alternative in solving poverty alleviation. This strategy can be used as a recommendation for further improvement of poverty alleviation policies by presenting policy implications and a roadmap for the action plan.

Foundations of Contemporary Economics: Harold Hotelling on Location and Exhaustible Resources

Harold Hotelling is an influential statistician working in the field of economic theory at the beginning of the 20th century. His contributions to economics are trailblazing and open new topics for economic and business analysis. His best-known work is his solution to the problem of exhaustible resources. He also triggered the exploration of spatial economics and the analysis of product differentiation through his solution of the optimal location of producers in a duopoly. Less known, but important, are his contributions to the development of modern neoclassical microeconomic theory. Hotelling is also one of the scientists who initiated the turn towards mathematical economics in the 1950s. In this paper we provide an introduction of his groundbreaking work on economic theory.

Scenario modelling and forecasting of spatial transformation in the Russian catering market

The COVID-19 pandemic and spatial peculiarities exacerbate the imbalance in the development of the catering market in Russia. The paper reveals the problems of spatial transformation of the market in Russian regions. Analysis of the theoretical foundations of the research showed that the existing methodological approaches neglect the spatial aspect of this transformation. Methodologically, the study relies on theoretical provisions of regional and spatial economics, including Perroux's growth pole theory, Christaller's central place theory, and Friedmann's core-periphery model. Using the methods of spatial autocorrelation analysis, regression modelling and ARIMA-forecasting, the authors develop a system-based approach to modelling and forecasting the processes of spatial transformation of the public catering market. The research specifies the main methods for forecasting the development indicators of the market, as well as their advantages and disadvantages;it also substantiates the need to apply spatial autocorrelation analysis for assessing the distinguishing features of the market transformation and proposes a methodology for its implementation. The authors established a downward trend in the catering market differentiation and an upward trend in the number of regions similar in terms of their development. Regression analysis helped identify the major factors affecting the catering market's turnover, such as GRP and average per capita income of the population. ARIMA-modelling of these factors' dynamics allowed designing forecast scenarios for the development of the Russian catering market until 2022. Based on the research results, the study outlines the development prospects of the Russian catering market in the context of a worsening epidemiological situation.

Spatial agglomeration and firm productivity: Does trade status matter?

AbstractThis study uses micro‐level panel data from Chinese manufacturing firms to investigate the impact of spatial agglomeration on firm productivity, taking a firm’s engagement in international trade into consideration. Embracing firm heterogeneity in trade status, we find that non‐exporters benefit from urban agglomeration through manufacturing specialization, whereas little effect of local specialization on productivity is found among exporters. The findings are driven mainly by processing exporters involved in straightforward assembly. These findings increase the understanding of heterogeneous productivity gains from urban agglomeration and the spatial economy in China.

Comparative analysis of cluster and system approaches in border area development management (Russia – China)

The balanced socio–economic development of the territory of Russia is one of the main goals of managing the country’s economy. An important role in achieving this goal is played by the development of Russian border territories, especially those remote from the central regions of the country, but having sufficiently developed economic ties with neighboring countries. Russia and China have a fairly long border and vast border areas, in the development of which the governments of both countries are interested. A balanced long– term development of border areas is impossible without scientifically grounded state programs, the development of which presupposes a preliminary comparative analysis of the methodological and theoretical foundations of scientific theories, as well as their relevance to the set goals and objectives.The subject of research in the article is the heuristic possibilities of the cluster approach of the theory of spatial economics, on the one hand, and the ecosystem approach of the theory of socio–economic ecosystems, on the other. The research results are to identify the relative advantages and disadvantages of the cluster and system approaches as theoretical, methodological and practical tools for the development and implementation of programs for the socio–economic development of the territories of the Russian Federation bordering China. The author substantiated the advantages of the theory of socio–economic ecosystems as a theoretical and methodological tool for programs for the development of border areas.

A Line in Space: Pricing, Location, and Market Power in Agricultural Product Markets

Agricultural economists have a long history of emphasizing and analyzing the spatial dimension of agricultural and food markets. Despite a rich body of literature and important contributions to agricultural and spatial economics, one aspect is frequently disregarded: the oligopsonistic nature of agricultural markets due to spatial competition of neighboring buyers of farm products. This review presents the theoretical foundations of spatial pricing, competition, and location in terms of buyer power and discusses concepts that are relevant for agricultural markets. By providing a comprehensive overview of prior work, we highlight the multifaceted areas of applications to agricultural markets. Additionally, we discuss future research avenues for and challenges of the analysis of spatial competition in agricultural economics.

Location dynamics of commercial art galleries in Sydney

ABSTRACT Art clusters in cities are welcomed by planners, residents and business. In respect to an urban economy, art clusters are viewed as beneficial because of their contribution to neighbourhood ambience in ways likely to attract young professionals who possess, it is said, higher propensity for innovation and creativity. Clusters of art activity are also seen as place-makers that enhance liveability, an important asset in the contemporary spatial economy. Yet there is little empirical work which examines the forces that drive the location of these places of art and their connection to the urban economy. This paper takes art galleries in Sydney, Australia, as a case study. Using data from a comprehensive survey, interviews and direct observation, the study finds a peculiar story of art clustering. Sydney’s galleries are found to be concentrated in exclusive locations. The study finds powerful agglomeration forces, including opportunities for stable property tenure, adjacency to the city’s cultural institutions, input of government funding and the presence of wealthy buyers among local residents. Certainly, the agglomerations identified meet criteria for recognition as cultural districts, yet in ways different to the images of edgy neighbourhoods presented in the literature as the substance of art in a post-industrial city.

Uneven Development of Spatial Economy of the Russian Federation and Differentiation of Growth Factors

The article discusses the problems of spatial development of the Russian Federation, analyzes the causes and trends of changes in the spatial structure of macroeconomic indicators by federal districts in the period 2008–2015 which witnessed the cyclical nature of economic development in Russia, and assesses the factors of regional growth for the period under consideration and the potential for further development of the Russian federal districts. The research focuses on the economy of the Russian federal districts in the period 2008–2015 characterized by the cyclical nature of the development of the Russian economy. On analyzing the periods of recession alone, it is almost impossible to obtain detailed information about the factors of economic growth. At the same time, analyzing merely the periods of growth does not take into account the possibilities of crises and their consequences. For a more detailed analysis, the time boundaries of the study were divided into three periods 2008–2010, 2010–2013 and 2013–2015.The work is aimed at analyzing the changes in the structures of macroeconomic indicators of the Russian Federation by federal districts in the period 2008–2015, determining the reasons and tendencies of their changes, studying the factors of regional growth in 2008–2015, and assessing the potential for further development of the regions of the Russian Federation. The research toolkit includes the methods for analyzing structural changes as well as the methods of logarithmic and proportional division. The analysis of structural changes was used both when considering GRP growth rate at constant prices and when studying the factors of growth at total labor productivity. Logarithmic division was used when dividing the yield rises by the rises of each of the factors (e.g. decomposition of GRP rises in current prices). Proportional division was used to assess the impact of regional industries on economic growth as a whole.

Methodological Assessment Tools of Spatial Interactions

At present, the effective and rational use of the spatial factor is one of the conditions for economic growth and development of territories. The article is devoted to the assessment of spatial interactions and systematization of the existing methodological tools for this purpose. In the course of the study, it is determined that spatial interactions are a process of movement between the “source” and the “receiver” of various objects (goods, people, transport, information, etc.). The conditions for the emergence and development of interactions in the economic space are highlighted. Based on foreign and domestic works on the problems of the research, two groups of methods for assessing spatial interactions (heuristic and economic-mathematical) are identified and characterized. The basic directions and mandatory stages of spatial interaction assessment, despite the chosen tools, are highlighted. It is determined that the coordinated use of modern tools of spatial econometrics, coupled with heuristic methods, will contribute to obtaining the most adequate and objective results. The results obtained contribute to the development of ideas about the spatial economy and can be used in the implementation of government policies in the field of spatial and regional development, as well as by researchers and other stakeholders in the assessment of spatial interactions. In the next stages of the work, it is planned to analyze the spatial interactions of Russian regions using the tools of modern spatial econometrics.