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G02-O9 Regional Economic Development

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Ordinary Sessions
Thursday, August 31, 2017
2:00 PM - 3:30 PM
HC 1312.0013

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Chair: Ariel Gustavo Letti


Speaker

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Prof. Barbara Martini
Associate Professor
Università di Roma Tor Vergata

Resilience and regional specialization: are they related?

Author(s) - Presenters are indicated with (p)

Barbara Martini (p), Marco Platania

Abstract

Resilience gained a lot if interest in Regional Science after the 2007 economic shocks. A review concerning resilience is provided by Modica e Reggiani (2014). Resilience is not a regional fixed attribute (Martin e Sunley 2015) but it is a multifaceted process made by four interrelated dimensions (Martin 2012). How these dimensions are interrelated is a topic still in progress in literature. Moreover shocks can be different for severity and length and they can impact in different way across different regions. As consequence different shocks generate different reactions and different levels of resilience (Martin 2016) and, therefore, resilience cannot be considered as a fixed attribute of a region. There are moreover some other characteristics that shape a region’s reaction after a shock. One of these is the industrial structure and industrial composition in a region. Shock can be sector specific. In this case specialized regions are perceived to be less vulnerable to a shock because the regional economy is dominated by one principal industry. By contrast diversified regions have higher chance to be hit by a sector specific shock. Nevertheless, despite this higher risk a diversified regions has a lower probability that a sector specific shock has a negative impact on the local economy as whole. In other words industrial variety in a region spread the risk and can better accommodate idiosyncratic shocks (Boschma 2015). The aim of the paper is to investigate if a greater level of specialization increase or decrease the regional resilience. Using the employment data (Cellini Torrisi 2012, Fingleton et al., 2012, Lagravinese 2015, Martin et al. 2016) we will calculate the resilience index proposed by Martin (2016) for Italians regions during the period 1993-2015. Moreover we will use the most common indexes of specialization proposed literature. Finally we will compare the resilience index, divide in resistance and recovery, with specialization index to study if there is a relation. Some policies indication will be discussed.

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Dr. Martijn Smit
Assistant Professor
Universiteit Utrecht

Ping times: relating internet connectivity to economic growth

Author(s) - Presenters are indicated with (p)

Martijn Smit (p)

Abstract

Since the last decade of the twentieth century, internet access has become a sine qua non for businesses. The computer industry and commercial internet businesses have been growing fast over the past decades. But many other sectors too heavily depend on internet access. Although very visible in the service sectors (e.g., publishing), its importance is not limited to those; industrial services such as design and warehousing, to name but two examples, also rely on and benefit from cooperation at a distance.
Therefore, national, regional and local governments have been involved in a race to procure and advertize their internet connectivity. Now obviously, most of that race for connectivity had been decided at its start. There are so many location factors other than broadband access that are important for firms that the actual cable-laying could not have fundamentally altered the hierarchy in many countries. If we look at the Netherlands, for example, efforts have been made to promote the internet assets of cities such as Groningen, Enschede and Eindhoven (which not by coincidence all three feature a university offering degrees in technology-oriented fields).
However, a clear economic hierarchy has been in existence in the country for a long time, with the Randstad in leading position at least since the sixteenth century. Amsterdam is the main location for the creative sector, for knowledge-intensive services and for industrial headquarters (e.g. Philips, that finally moved its HQ from Eindhoven to Amsterdam in 1997). It quickly rose to become the country’s main IT hub, with the Amsterdam Internet Exchange among the largest in Europe (Chatzis, Smaragdakis, Feldmann, & Willinger, 2013). So although other factors definitely play a role, internet access could theoretically still be a (small) engine of growth. Policy makers seem to believe that it is important and that it can provide a boost to the local economy (van Winden & Woets, 2004), particularly before the 2001 dot-com crisis dampened their enthousiasm somewhat.

We therefore test empirically whether the level of connectedness to the global IT infrastructure has a correlation with economic growth in sectors that supposedly use such infrastucture. We do this using a panel of US cities, in which we zoom in on a few sectors that can use the infrastructure, and compare them against the background of other sectors in the same cities. As a measure for the quality of local connections, we use the latency (ping times) rather than bandwidth.
Prof. Ariel Gustavo Letti
Ph.D. Student
UFPR, UV and UNEB

Regional development and the relative efficiency of Brazilian Universities

Author(s) - Presenters are indicated with (p)

Ariel Gustavo Letti (p), Mauricio Bittencourt (p)

Abstract

We applied DEA methodology to evaluate the relative efficiency of several groups of Higher Education Institutions (HEIs) in Brazil, in a total of 224 for the year of 2012. The analysis was performed at three levels, by evaluating three independent groups of public HEIs: large (51), medium (70) and small universities (103).
Due to the rigorously selected dataset employed to define the set of inputs and outputs, and considering all brazilian public HEIs, this work is a step forward to previous studies such as those of Ramos and Souza (1997), Corbucci (2000), Façanha and Marinho (2001), Belloni (2001), Oliveira and Turrioni (2005), Benicio et al (2012), Duenhas (2013), Costa, Ramos and Souza (2014) and Bittencourt et al (2016). This is the first time it is used information about university services (extension) and registered patents (inovation) to all brazilian public HEIs.
The data come primarily from the National Institute of Teaching and Educational Research (INEP/MEC, ‘Higher Education Census’), Improvement Coordination of People of Higher Education (CAPES), National Institute of Industrial Property (INPI).
In a preliminary stage, this study used diverse combinations of five inputs and seven outputs in the DEA analysis (with variable returns to scale and input orientation) to choose the best combination, which was an attempt to deal with the three dimensions of higher education: teaching, research and services.
Preliminary results showed that most of the universities (64%) were efficient in the set of large HEIs. In the case of medium HEIs we find 41% of institutions in the efficient frontier, and for the case of small HEIs only 21.36% were in the efficient frontier. The efficiency means: 0.96 to larger, 0.84 to medium and 0.50 to small HEIs.
Results also suggest that 140 HEIs (62.5% of the sample) work inefficiently, contributing to a significant waste of resources. These results should claim for the attention of public authorities, HEIs’ administrative and management bodies. Moreover, in a context of financial stringency like that characterizing the current times in Brazil, where public HEIs must become increasingly more dependent from government funding (or not), the topic of efficiency gains has an additional relevance in higher education sector.
As a following stage in this research agenda it would be a great contribution to search for potential determinants of HEIs’ technical efficiency and discover which factors explain the performance of higher education institutions in Brazil.
Dr. Iordan Marioara
Senior Researcher
Institute For Economic Forecasting

Development Patterns in the EU and Romanian Regions - Convergence and Resilience

Author(s) - Presenters are indicated with (p)

Iordan Marioara (p), Chilian Mihaela-Nona, Pauna Carmen Beatrice

Abstract

The current European Union and international context is increasingly stressing the process of EU integration to the point of threatening the existence of the EU itself. In such circumstances, the EU and Member States regional policies goal of how to generate a process of convergence conducive to benefits to all the EU citizens and not to a mere quantitative convergence of the regional income per capita is increasingly linked to other areas of economic and social development and policy, such as the resilience of national and regional economies to shocks, sustainable development and climate change mitigation, securing an adequate balance between globalization and local development, etc. In the economic literature, the theories of convergence and divergence examine the reasons for diminishing or increasing disparities between the rich and the poor regions, while the economic resilience of regions/locations deals with their capability to record economic growth accompanied by social inclusion, environment protection and rapid recovery after shocks. Though differently, both concepts may reveal both the long-term adaptability and the capability of the social and economic milieu and government institutions of a region/location to respond to short-term pressures and recover and resume development after different shocks.
In such a context, based on the concept of real convergence and resilience, the paper presents an analysis of these processes in the EU (more precisely, in the New Member States) and Romanian regions, by using a joint set of indicators chosen as to assess the two processes together.
The results reveal different convergence and resilience patterns both in the EU and Romanian regions, the regional economies adapting differently to the challenging EU and international economic environment, generally conditional on their development level. However, especially regarding the productivity patterns, the situation seems worrisome for the laggard regions, both more or less developed, including most of the Romanian regions. While being in line with the findings of other studies on the economic development of the Member States regions, the results also reveal certain peculiarities of the ongoing development processes in the EU and Romanian regional economies. All these call both for adequate implementation of the existing national general and development policies, as well as of the EU regional policy, and for finding new policy measures and actions to deal with the existing and future economic and social challenges and threats.

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