Tomohiro Kitamura (p)

Water and sewerage industries are operated by local public companies in Japan. There are companies that operate water only, sewerage only, and both water and sewerage. In Japan, it is said that water-operate companies and sewerage-operate companies will face more difficult financial situations stemming from reduction in population and increase in cost of aged facilities’ renewal. To improve their operational situation, government has promoted vertical integration of water and sewerage systems. The vertical integration means that one local public company operates both water and sewerage systems. In 2016, more than 70% of the companies operate both water and sewerage. If we reveal that operating water and sewerage systems jointly improves the companies’ performance, we can give a policy implication of promoting integration of water and sewerage systems.
This study empirically examines whether the productivity of water-sewerage integrated systems is higher than that of separated systems. We compute labor productivity and total factor productivity (TFP) of the companies by adopting the cross-sectional data of Japanese water-operate and sewerage-operate companies in 2016. Then we examine whether there is the difference in the productivity between water-sewerage integrated systems and separated systems.
The empirical results show that the productivity of water-sewerage integrated systems is not significantly higher than that of separated systems. This indicates that increasing the productivity of companies by integration of water and sewerage may be difficult. Hence, other ways such as consolidation of facilities should be promoted to improve performance of water and sewerage companies under the difficult financial situations.

Mokrane Mohamed (p)

This study is focused on the impact of governance and other economic growth determinants on economic growth of 13 Middle East and North African (MENA) countries during the period 1996 -2017. We used World bank data for World development indicators (WDI) and Worldwide governance index (WGI) data on institutional quality and governance. The principal components analysis is used for reducing the six governance indicators created by the world bank. Panel regression was run using fixed effects method of estimation based on Hausman specification test results. After all corrections, the generalized least squares estimation given the best results. Findings reveal that, namely governance, trade openness, and Final consumption expenditure have a positive and significative effect on economic growth which is according to theory. On the other hand, results show that foreign direct investment, inflation, Gross fixed capital formation and Net official development assistance received have a negative and significative effect on economic growth for the selected countries.

Dante Di Matteo (p)

Although Structural Funds act as the main financial leverage to encourage the rebalancing of structural inequalities among European regions, substantial literature points out different impacts, absorption and response capacities to the cohesion policies carried out during the various programming periods. The multilevel structure of the CP implies a mediating role from the regional and local bodies for drawing up and shaping the level of interventions, depending on the convergence objective of each region. Among these premises can be found some primary reasons for explaining such heterogeneity among the studies on CP. With the aim to deepen the grounds behind the effectiveness of CP on regions' growth and development, this study is proposing a systematic literature review of studies addressing the impact of cohesion policies on European regions and the role of the different structural and investment funds for achieving objectives spread on the various axes of intervention. A selection of 46 studies was processed through a meta-analysis and it focuses both on econometrical and on qualitative analyses, by including not only economic performance indicators as model outputs, like GDP, but also social indicators, like those assessing depopulation issues, in line with the primary recent objectives of lagging regions. Among the main highlights, differences in geographical extent and in the use of control variables are presented as the major factors of heterogeneity.

Pinar Deniz, Burhan Can Karahasan (p), Mehmet Pinar

Subjective well-being has been extensively discussed at country level. While, some of these studies use micro level data in order to understand within country differences, others use aggregate data for exploring the cross country variation. These studies find out that subjective well-being is prone to significant amount of variability at individual and country level. That said, regional dimension of subjective well-being has not central to these studies. More interestingly, literature explaining the variation of subjective well-being points out the importance of factors such as unemployment, education, standard of living, poverty, health outcomes and income disparities. Even though these factors are crucial, a possible neglected dimension is the existence of political factors. For instance, one can expect that individuals' political decisions and outcome of the elections at local level can shape the geographical distribution of well-being. We discuss that, individuals residing in regions that are close to government's ideological stance can realize better subjective well-being. Therefore, an institutional network can exist among the individuals and central government which in turn shapes the level of regional well-being. Evolving around discussions on spatial and political dimension of well-being, this study aims to explore how political factors influence spatial variation of well-being among the NUTS III level Turkish regions. Using province level data and controlling for a host of determinants that are likely to influence regional well-being, findings pin-point that ideological fractionalization and distance to ideological stance of the government both matters for understanding the spatial variation of regional well-being in Turkey. Moreover, our findings highlight that spatial dimension matters as well. First, spatial variation of regional well-being is not random. Rather there is significant spatial auto-correlation for well-being at local level. That is, level of well-being in a region is not independent from its spatial proximity. Finally, we find out that spatial heterogeneity is also crucial. These results from spatial analysis point out that impact of political factors on regional well-being has a non-random geographical pattern, albeit this link is spatially heterogeneous. This reminds that one size does not fit all in terms of local impact of political factors.

Yoshifumi Ishikawa (p)

Various types of policies related to economic promotion and population growth have been implemented for regional revival. The economic effects of these policies are generally estimated using an intra-regional input-output model, and these policies are evaluated by indexes such as production, value added, and labor income. However, one major issue with the intra-regional model commonly used is how to endogenize private household consumption that can be linked to labor income. Labor income estimated by the conventional model is not the net regional income, but rather, the gross regional income. That is, the gross regional income is distributed to the other region due to interregional commuting, and some part of the consumption demand of households living in a region is allocated to the other region. Therefore, the conventional model may overestimate the economic effects of the own region.
In this study, we developed an interregional input-output model with interregional commuting and consuming regions and considered a new method for analyzing the economic effects of such promotion policies for a small region. As an example, we analyzed the effects of some regional policies for some cities using this model and found that analysis using the conventional model overestimates the economic effects of regional policy.