Progress 10/01/09 to 09/30/10
Outputs
OUTPUTS: The research resulted in 15 not previously reported publications during the period 2009-2010, within the three areas of attention focusing on economic growth, valuation of environmental externalities, and the development of methods. The outputs are primarily of an academic nature, and have been distributed through publications in journals and books, online available working papers as well as through conference presentations. PARTICIPANTS: Beckhusen, J., Purdue University, West Lafayette, USA Brouwer, F., Agricultural Economics Research Institute (LEI), The Hague, The Netherlands Brown, J.P., Purdue University, West Lafayette, USA Chen, S.E., Purdue University, West Lafayette, USA Dalhuisen, J., VU University, Amsterdam, The Netherlands Daniel, V.E., Institute for Environmental Studies, VU University, Amsterdam, The Netherlands De Graaff, T., VU University, Amsterdam, The Netherlands De Groot, H.L.F., VU University, Amsterdam, The Netherlands Foster, K.A., Purdue University, West Lafayette, USA Helmers, G., Purdue University, West Lafayette, USA Holt, M.T., Purdue University, West Lafayette, USA Koetse, M.J.J., VU University, Amsterdam, The Netherlands Kuethe, T.H., USDA-ERS, Washington DC, USA Lambert, D.M., University of Tennessee, Knoxville, USA Masters, W.A., Purdue University, West Lafayette, USA McNamara, K.T., Purdue University, West Lafayette, USA Motamed, M., USDA-ERS, Washington DC, USA Nijkamp, P., VU University, Amsterdam, The Netherlands Oltmer, K., Agricultural Economics Research Institute (LEI), The Hague, The Netherlands Partridge, M., The Ohio State University, Columbus, USA Pede, V., International Rice Research Institute, Philippines Rietveld, P., VU University, Amsterdam, The Netherlands Snyder, S.D., Purdue University, West Lafayette, USA Vroom, G., University of Navarra, Barcelona, Spain Waldorf, B.S., Purdue University, West Lafayette, USA TARGET AUDIENCES: Development planners PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.
Impacts
In the area of economic growth and development, activities have focused on analyzing investment flows in U.S. manufacturing, entry and exit behavior of manufacturing firms, regional economic growth at the county level, and the role of human capital in language acquisition among immigrants to the U.S. In the valuation of environmental externalities most of the attention has been drawn towards the valuation of environmental hazards, specifically river flooding potentially induced by climate change. In addition, a meta-analysis of the relationship between uncertainty and investments has proven particularly relevant when it comes to evaluating the option value of postponing investments in energy-efficient technology. Understanding such postponement strategies, known as the "investment paradox", is essential for policies aimed at increasing the energy efficiency of energy-extensive firms. Extensive methodological work in the area of spatial econometrics has resulted in the development of a new technique for spatial data analysis that focuses on a spatial lag model for Poisson-distributed count data. Both experimental Monte Carlo simulations as well as an empirical application to county firm birth patterns in the U.S. have demonstrated the usefulness of the technique.
Publications
- Lambert, D.M., Brown, J.P. and Florax, R.J.G.M. (2010) A Two-Step Estimator for a Spatial Lag Model of Counts: Theory, Small Sample Performance and an Application, Regional Science and Urban Economics 40(4), 241-252.
- Chen, S.E. and Florax, R.J.G.M. (2010) Zoning for Health: The Obesity Epidemic and Opportunities for Local Policy Intervention, Journal of Nutrition 140(6), 1181S-1184S.
- Chen, S.E., Florax, R.J.G.M., Snyder, S.D. and Miller, C. (2010) Does where you Live Make you fat Obesity and Access to Chain Grocers, Economic Geography 86(4), 431-452.
- Oltmer, K., Nijkamp, P., Florax, R.J.G.M. and Brouwer, F. (2009) Sustainability and Agri-Environmental Policy in the European Union: A Meta-Analytic Investigation, in: de Noronha Vaz, T., Nijkamp, P. and Rastoin, J.-L. (eds.), Traditional Food Production and Rural Sustainable Development: A European Challenge, Farnham: Ashgate, 27-55.
- Lambert, D.M., Brown, J.P. and Florax, R.J.G.M. (2010) A Two-Step Estimator for a Spatial Lag Model of Counts: Theory, Small Sample Performance and an Application, West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper 10-05.
- Koetse, M.J., Florax, R.J.G.M. and de Groot, H.L.F. (2009) Consequences of Effect Size Heterogeneity for Meta-Analysis: A Monte Carlo Study, Statistical Methods and Applications 19(2), 217-236.
- Anastasopoulos, P.C., Florax, R.J.G.M., Labi, S. and Karlaftis, M.G. (2010) Contracting in Highway Maintenance and Rehabilitation: Are Spatial Effects Important, Transportation Research A, Policy and Practice, 44(3), 136-146.
- Ngeleza, G., Florax, R. and Masters, W. (2009) Spatial Inequality and Economic Development in Africa: Neighborhood Effects in a Simultaneous Equation Framework, in: Gopinath, M. and Kim, H. (eds.), Globalization and the Rural-Urban Divide, Seoul: Seoul National University Press.
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Progress 10/01/05 to 09/30/10
Outputs
OUTPUTS: The research resulted in 15 not previously reported publications during the period 2009-2010, within the three areas of attention focusing on economic growth, valuation of environmental externalities, and the development of methods. The outputs are primarily of an academic nature, and have been distributed through publications in journals and books, online available working papers as well as through conference presentations. PARTICIPANTS: Beckhusen, J., Purdue University, West Lafayette, USA Brouwer, F., Agricultural Economics Research Institute (LEI), The Hague, The Netherlands Brown, J.P., Purdue University, West Lafayette, USA Chen, S.E., Purdue University, West Lafayette, USA Dalhuisen, J., VU University, Amsterdam, The Netherlands Daniel, V.E., Institute for Environmental Studies, VU University, Amsterdam, The Netherlands De Graaff, T., VU University, Amsterdam, The Netherlands De Groot, H.L.F., VU University, Amsterdam, The Netherlands Foster, K.A., Purdue University, West Lafayette, USA Helmers, G., Purdue University, West Lafayette, USA Holt, M.T., Purdue University, West Lafayette, USA Koetse, M.J.J., VU University, Amsterdam, The Netherlands Kuethe, T.H., USDA-ERS, Washington DC, USA Lambert, D.M., University of Tennessee, Knoxville, USA Masters, W.A., Purdue University, West Lafayette, USA McNamara, K.T., Purdue University, West Lafayette, USA Motamed, M., USDA-ERS, Washington DC, USA Nijkamp, P., VU University, Amsterdam, The Netherlands Oltmer, K., Agricultural Economics Research Institute (LEI), The Hague, The Netherlands Partridge, M., The Ohio State University, Columbus, USA Pede, V., International Rice Research Institute, Philippines Rietveld, P., VU University, Amsterdam, The Netherlands Snyder, S.D., Purdue University, West Lafayette, USA Vroom, G., University of Navarra, Barcelona, Spain Waldorf, B.S., Purdue University, West Lafayette, USA TARGET AUDIENCES: Development planners PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.
Impacts
In the area of economic growth and development, activities have focused on analyzing investment flows in U.S. manufacturing, entry and exit behavior of manufacturing firms, regional economic growth at the county level, and the role of human capital in language acquisition among immigrants to the U.S. In the valuation of environmental externalities most of the attention has been drawn towards the valuation of environmental hazards, specifically river flooding potentially induced by climate change. In addition, a meta-analysis of the relationship between uncertainty and investments has proven particularly relevant when it comes to evaluating the option value of postponing investments in energy-efficient technology. Understanding such postponement strategies, known as the "investment paradox", is essential for policies aimed at increasing the energy efficiency of energy-extensive firms. Extensive methodological work in the area of spatial econometrics has resulted in the development of a new technique for spatial data analysis that focuses on a spatial lag model for Poisson-distributed count data. Both experimental Monte Carlo simulations as well as an empirical application to county firm birth patterns in the U.S. have demonstrated the usefulness of the technique.
Publications
- Lambert, D.M., Brown, J.P. and Florax, R.J.G.M. (2010) A Two-Step Estimator for a Spatial Lag Model of Counts: Theory, Small Sample Performance and an Application, Regional Science and Urban Economics 40(4), 241-252.
- Chen, S.E. and Florax, R.J.G.M. (2010) Zoning for Health: The Obesity Epidemic and Opportunities for Local Policy Intervention, Journal of Nutrition 140(6), 1181S-1184S.
- Chen, S.E., Florax, R.J.G.M., Snyder, S.D. and Miller, C. (2010) Does where you Live Make you fat Obesity and Access to Chain Grocers, Economic Geography 86(4), 431-452.
- Koetse, M.J., Florax, R.J.G.M. and de Groot, H.L.F. (2009) Consequences of Effect Size Heterogeneity for Meta-Analysis: A Monte Carlo Study, Statistical Methods and Applications 19(2), 217-236.
- Anastasopoulos, P.C., Florax, R.J.G.M., Labi, S. and Karlaftis, M.G. (2010) Contracting in Highway Maintenance and Rehabilitation: Are Spatial Effects Important, Transportation Research A, Policy and Practice, 44(3), 136-146.
- Ngeleza, G., Florax, R. and Masters, W. (2009) Spatial Inequality and Economic Development in Africa: Neighborhood Effects in a Simultaneous Equation Framework, in: Gopinath, M. and Kim, H. (eds.), Globalization and the Rural-Urban Divide, Seoul: Seoul National University Press.
- Oltmer, K., Nijkamp, P., Florax, R.J.G.M. and Brouwer, F. (2009) Sustainability and Agri-Environmental Policy in the European Union: A Meta-Analytic Investigation, in: de Noronha Vaz, T., Nijkamp, P. and Rastoin, J.-L. (eds.), Traditional Food Production and Rural Sustainable Development: A European Challenge, Farnham: Ashgate, 27-55.
- Lambert, D.M., Brown, J.P. and Florax, R.J.G.M. (2010) A Two-Step Estimator for a Spatial Lag Model of Counts: Theory, Small Sample Performance and an Application, West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper 10-05.
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Progress 10/01/08 to 09/30/09
Outputs
OUTPUTS: The research resulted in 16 not previously reported publications during the period 2008-2009, within the three areas of attention focusing on economic growth, valuation of environmental externalities, and the development of methods. The outputs are primarily of an academic nature, and have been distributed through publications in journals and books, online available working papers as well as through conference presentations. PARTICIPANTS: Beckhusen, J., Purdue University, West Lafayette, USA Brouwer, F., Agricultural Economics Research Institute (LEI), The Hague, The Netherlands Brown, J.P., Purdue University, West Lafayette, USA Chen, S.E., Purdue University, West Lafayette, USA Dalhuisen, J., VU University, Amsterdam, The Netherlands Daniel, V.E., Institute for Environmental Studies, VU University, Amsterdam, The Netherlands De Graaff, T., VU University, Amsterdam, The Netherlands De Groot, H.L.F., VU University, Amsterdam, The Netherlands Foster, K.A., Purdue University, West Lafayette, USA Helmers, G., Purdue University, West Lafayette, USA Holt, M.T., Purdue University, West Lafayette, USA Koetse, M.J.J., VU University, Amsterdam, The Netherlands Kuethe, T.H., USDA-ERS, Washington DC, USA Lambert, D.M., University of Tennessee, Knoxville, USA Masters, W.A., Purdue University, West Lafayette, USA McNamara, K.T., Purdue University, West Lafayette, USA Motamed, M., USDA-ERS, Washington DC, USA Nijkamp, P., VU University, Amsterdam, The Netherlands Oltmer, K., Agricultural Economics Research Institute (LEI), The Hague, The Netherlands Partridge, M., The Ohio State University, Columbus, USA Pede, V., International Rice Research Institute, Philippines Rietveld, P., VU University, Amsterdam, The Netherlands Snyder, S.D., Purdue University, West Lafayette, USA Vroom, G., University of Navarra, Barcelona, Spain Waldorf, B.S., Purdue University, West Lafayette, USA TARGET AUDIENCES: Spatial and environmental economists and policy makers in the areas of (regional) development, environmental and health economics. PROJECT MODIFICATIONS: Not relevant to this project.
Impacts
In the area of economic growth and development, activities have focused on analyzing investment flows in U.S. manufacturing, entry and exit behavior of manufacturing firms, regional economic growth at the county level, and the role of human capital in language acquisition among immigrants to the U.S. In the valuation of environmental externalities most of the attention has been drawn towards the valuation of environmental hazards, specifically river flooding potentially induced by climate change. In addition, a meta-analysis of the relationship between uncertainty and investments has proven particularly relevant when it comes to evaluating the option value of postponing investments in energy-efficient technology. Understanding such postponement strategies, known as the "investment paradox", is essential for policies aimed at increasing the energy efficiency of energy-extensive firms. Extensive methodological work in the area of spatial econometrics has resulted in the development of a new technique for spatial data analysis that focuses on incorporating non-linear smooth transitions in spatial regression models. These models are referred to as spatial STAR models (Smooth Transition Autoregressive Models). Both experimental Monte Carlo simulations as well as an empirical application to county economic growth patterns in the U.S. have demonstrated the usefulness of the technique. It is anticipated that this technique can be a valuable alternative to well-known techniques such as Geographically Weighted Regression and so-called spatial regimes.
Publications
- Koetse, M.J., de Groot, H.L.F. and Florax, R.J.G.M. (2009) A Meta-Analysis of the Investment-Uncertainty Relationship, Southern Economic Journal 76(1), 283-306.
- Dalhuisen, J.M., Florax, R.J.G.M., de Groot, H.L.F. and Nijkamp, P. (2009) Price and Income Elasticities of Residential Water Demand: A Meta-Analysis, in: R. Quentin Grafton (Ed.), Economics of Water Resources, Volume II, The International Library of Critical Writings in Economics, Cheltenham: Edward Elgar, 278-294.
- Oltmer, K., Nijkamp, P., Florax, R.J.G.M. and Brouwer, F. (2009) Sustainability and Agri-Environmental Policy in the European Union: A Meta-Analytic Investigation, in: T. de Noronha Vaz, P. Nijkamp, J.-L. Rastoin (Eds.), Traditional Food Production and Rural Sustainable Development: A European Challenge, Farnham: Ashgate, 27-55.
- Kuethe, T.H., Foster, K.A. and Florax, R.J.G.M. (2008) A Spatial Hedonic Model with Time-Varying Parameters: A New Method Using Flexible Least Squares, American Agricultural Economics Association, 2008 Annual Meeting, July 27-29, Orlando, Florida, 22 pages, http://purl.umn.edu/6306.
- Motamed, M., Florax, R.J.G.M. and Masters, W. (2009) Geography and Economic Transition: Global Spatial Analysis at the Grid Cell Level, Agricultural and Applied Economics Association, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin, 30 pages, http://purl.umn.edu/49589.
- Helmers, G., Florax, R.J.G.M. and Vroom, G. (2009) Entry, Ownership Form, and Spatial Location: An Analysis of the Hotel Industry, Agricultural and Applied Economics Association, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin, 20 pages, http://purl.umn.edu/49561.
- Pede, V., Florax, R.J.G.M. and Holt, M.T. (2009) A Spatial Econometric STAR Model with an Application to U.S. County Economic Growth, 1969-2003, Agricultural and Applied Economics Association, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin, 23 pages, http://purl.umn.edu/48117.
- Waldorf, B.S., Beckhusen, J., Florax, R.J.G.M. and de Graaff, T. (2009) The Role of Human Capital in Language Acquisition among Immigrants in U.S. Metropolitan Areas, Agricultural and Applied Economics Association, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin, 12 pages, http://purl.umn.edu/48643.
- Brown, J.P., Lambert, D.M. and Florax, R.J.G.M. (2009) Firm Birth and Death in U.S. Manufacturing: A Regional Adjustment Model, Agricultural and Applied Economics Association, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin, 33 pages, http://purl.umn.edu/49467.
- Pede, V., Florax, R.J.G.M. and Partridge, M. (2009) Employment Growth and Income Inequality: Accounting for Spatial and Sectoral Differences, Agricultural and Applied Economics Association, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin, 23 pages, http://purl.umn.edu/49460.
- Brown, J.P., Florax, R.J.G.M. and McNamara, K.T. (2009) Determinants of Investment Flows in U.S. Manufacturing, West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper #09-10, 27 pages, http://purl.umn.edu/54835.
- Chen, S., Florax, R.J.G.M. and Snyder, S. (2009) Does where you Live Make you Fat Obesity and Access to Chain Grocers, West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper #09-11, 27 pages, http://purl.umn.edu/53838.
- Chen, S.E., Florax, R.J.G.M. and Snyder, S.D. (2009) Obesity in Urban Food Markets: Evidence from Georeferenced Micro Data, Ann Arbor: National Poverty Center, The University of Michigan, Working Paper, 25 pages, http://www.npc.umich.edu/news/events/food-access/chen_et_al_revised.p df.
- Daniel, V.E., Florax, R.J.G.M. and Rietveld, P. (2009) Flooding Risk and Housing Values: An Economic Assessment of Environmental Hazard, Ecological Economics 69(2), 355-365.
- Koetse, M.J., Florax, R.J.G.M. and de Groot, H.L.F. (2009) Consequences of Effect Size Heterogeneity for Meta-Analysis: A Monte Carlo study, Statistical Methods and Applications, http://www.springerlink.com/content/2308q653hl427655/fulltext.pdf.
- Daniel, V.E., Florax, R.J.G.M. and Rietveld, P. (2009) Floods and Residential Property Values: A Hedonic Price Analysis for the Netherlands, Built Environment 35(4), 563-576.
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Progress 10/01/07 to 09/30/08
Outputs
OUTPUTS: The research resulted in 8 publications during the period 2007-2008, within the three areas of attention focusing on economic growth, valuation of environmental externalities, and the development of methods. The outputs are primarily of an academic nature, and have been distributed through publications in journals and books as well as through conference presentations. PARTICIPANTS: De Dominicis, L., VU University, Amsterdam, The Netherlands De Groot, H.L.F., VU University, Amsterdam, The Netherlands Waldorf, B.S., Purdue University, West Lafayette, USA Beckhusen, J., Purdue University, West Lafayette, USA Griffin, T.W., University of Arkansas, Little Rock, USA Dobbins, C.L., Purdue University, West Lafayette, USA Vyn, T., Purdue University, West Lafayette, USA Lowenberg-DeBoer, J., Purdue University, West Lafayette, USA Koetse, M.J.J., VU University, Amsterdam, The Netherlands Lambert, D.M., University of Tennessee, Knoxville, USA Cho, S.H., University of Tennessee, Knoxville, USA Brown, J.P., Purdue University, West Lafayette, USA McNamara, K.T., Purdue University, West Lafayette, USA Nistor, A., Brock University, St. Catherines, Canada TARGET AUDIENCES: Economists interested in spatial analysis PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.
Impacts
In the area of economic growth, activities have focused on reviewing the current literature with respect to the progress that has been made in implementing spatial econometric techniques, as well as a quantitative assessment of the impact of income inequality on economic growth processes. Recent meta-analytical work on economic growth and income equality reveals systematic variation in the literature as to the hypothesized negative link between economic growth and income inequality. The methodological work documents estimation procedures and results for an empirical investigation of the performance of the recently developed spatial, heteroskedasticity and autocorrelation consistent (HAC) covariance estimator calibrated with different kernel bandwidths. The empirical example is concerned with a hedonic price model for residential property values. The first bandwidth approach varies an a priori determined plug-in bandwidth criterion. The second method is a data driven cross-validation approach to determine the optimal neighborhood. The third approach uses a robust semivariogram to determine the range over which residuals are spatially correlated. The results for the semivariogram and the cross-validation approaches are very similar which, given its computational simplicity, gives the semivariogram approach an edge over the more flexible cross-validation approach.
Publications
- De Dominicis, L., De Groot, H.L.F. de and Florax, R.J.G.M. (2008) Meta-Analysis of the Relationship between Income Inequality and Economic Growth, Scottish Journal of Political Economy 55(5), 654-682.
- Waldorf, B.S., Florax, R.J.G.M. and Beckhusen, J. (2008) Spatial Sorting of Immigrants across Urban and Rural Areas in the United States: Changing Patterns of Human Capital Accumulation since the 1990s, American Journal of Agricultural Economics 90(5), 1312-1318.
- Griffin, T.W., Dobbins, C.L., Vyn, T.J., Florax, R.J.G.M. and Lowenberg-DeBoer, J.M. (2008) Spatial Analysis of Yield Monitor Data: Case Studies of On-farm Trials and Farm Management Decision-making, Precision Agriculture 9(5), 269-283.
- Koetse, M.J., De Groot, H.L.F., and Florax, R.J.G.M. (2008) Capital-Energy Substitution and Shifts in Factor Demand: A Meta-Analysis, Energy Economics 30(5), 2236-2251.
- De Dominicis, L., De Groot, H.L.F. de and Florax, R.J.G.M. (2008) De ruimtelijke verdeling van economische activiteit: Agglomeratie- en locatiepatronen in Nederland, Kwartaalschrift Economie 5(1), 71-99.
- Lambert, D.M., Florax, R.J.G.M. and Cho, S.H. (2008) Bandwidth Selection for Spatial HAC and other Robust Covariance Estimators, West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper #08-10.
- Brown, J.P., Florax, R.J.G.M. and McNamara, K.T. (2008) Evolution of Investment Flows in U.S. Manufacturing: A Spatial Panel Approach, West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper #08-06.
- Nistor, A., Florax, R.J.G.M., Lowenberg-DeBoer, J. and Brown, J.P. (2008) Spatiotemporal Modeling of Agricultural Yield Monitor Data, West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper #08-01.
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Progress 10/01/06 to 09/30/07
Outputs
OUTPUTS: The research resulted in 6 publications during the period 2006-2007, within the three areas of attention focusing on economic growth, valuation of environmental externalities, and the development of methods. The outputs are primarily of an academic nature, and have been distributed through publications in journals and books as well as through conference presentations.
PARTICIPANTS: Daniel, V.E., Vrije Universiteit, Amsterdam, The Netherlands De Dominicis, L., Vrije Universiteit, Amsterdam, The Netherlands De Groot, H.L.F., Vrije Universiteit, Amsterdam, The Netherlands Koetse, M.J.J., Vrije Universiteit, Amsterdam, The Netherlands Masters, W.A., Purdue University, West Lafayette, USA Ngeleza, G., Minnesota State University, USA Rietveld, P. Vrije Universiteit, Amsterdam, The Netherlands Withagen, C.A., Tilburg University, Tilburg, The Netherlands
TARGET AUDIENCES: Spatial economists
Impacts
In the area of economic growth, activities have focused on reviewing the current literature with respect to the progress that has been made in implementing spatial econometric techniques, as well as a quantitative assessment of the magnitude and drivers of economic convergence processes. The spatial econometric work shows that studies in mainstream economics are clearly backed up by theoretical advances, and largely focus on determining spatial heterogeneity in the variation of economic growth (e.g., coastal location, tropics, disease). The research shows the importance of distinguishing between geographical and technological distance to the technology leader, and the impact of domestic investment in human capital. Recent meta-analytical work on economic growth and income equality reveals systematic variation in the literature as to the hypothesized negative link between economic growth and income inequality. In the area of the valuation of ecological externalities
work has centered on using meta-analysis to value wetlands, and the willingness to pay for a reduction of pesticide risk. The wetland research is based on the analysis of a very extensive database comprising over 200 wetland valuation studies, and provides evidence that valuation assessments should not disregard variations in income and population density among respondents. In addition, work focused on the substitutability of energy and capital. The results show that the heterogeneity in both the cross-price and Morishima elasticity samples can to a large extent be explained by study differences. We calculated short- and long-run elasticities for different regions and time periods. The resulting elasticities show that technological substitution potential is large, especially in the long run for North America. Despite substantial differences across regions and time periods, the estimated cross-price elasticities suggest capital-energy substitutability without exception. The results of
the work on economic growth provide evidence for what the bottom-line is in research so far and will provide guidance in future work on economic growth and income inequality. The work also provides context and qualification for policymakers when considering some of the standard results from economic growth theory and the alleged adverse relationship between economic growth and income inequality. Results in the area of the valuation of environmental or ecological externalities shows that the transfer of, for instance, wetland values from one (studied) location to an (unstudied) policy site should be done with great caution. The research shows that consumers are willing to pay substantially more for a pesticide reduction policy based on a ban of particular pesticide compounds and substantially less for the adoption of integrated pest management strategies as compared to ecocertification of food commodities. Concurrent work on capital-energy substitution provides valuable input for
computable general equilibrium models, which are frequently used to develop scenarios for future policy assessment.
Publications
- Koetse, M.J.J., de Groot, H.L.F. and Florax, R.J.G.M. (2007, in press; available online) Capital-Energy Substitution and Shifts in Factor Demand: A Meta-Analysis. Energy Economics.
- Withagen, C.A., Florax, R.J.G.M. and Mulatu, A. (2007) Optimal Environmental Policy Differentials in Open Economies under Emission Constraints. Journal of Economics 91(2), 129-149.
- Daniel, V.E., Florax, R.J.G.M. and Rietveld, P. (2007) Flooding Risk and Housing Values: An Economic Assessment of Environmental Hazard. West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper #07-02.
- Koetse, M.J., Florax, R.J.G.M. and de Groot, H.L.F. (2007) The Impact of Effect Size Heterogeneity on Meta-Analysis: A Monte Carlo Experiment. Amsterdam: Tinbergen Institute, Discussion Paper TI 2007-052/3.
- De Dominicis, L., Florax, R.J.G.M. and de Groot, H.L.F. (2007) De ruimtelijke verdeling van economische activiteit: Agglomeratie- en locatiepatronen in Nederland. Amsterdam: Vrije Universiteit, Research Memorandum 2007-18.
- Ngeleza, G., Florax, R.J.G.M. and Masters, W.A. (2006) Geographical and Institutional Determinants of Real Income: A Spatio-Temporal Simultaneous Equation Approach, West Lafayette: Dept. of Agricultural Economics, Purdue University, Working Paper #06-15.
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Progress 10/01/05 to 09/30/06
Outputs
In the area of economic growth, activities have focused on reviewing the current literature with respect to the progress that has been made in implementing spatial econometric techniques, as well as a quantitative assessment of the magnitude and drivers of economic convergence processes. The spatial econometric work shows that studies in mainstream economics are clearly backed up by theoretical advances, and largely focus on determining spatial heterogeneity in the variation of economic growth (e.g., coastal location, tropics, disease). Spatial econometric studies are less theory-driven and pay due attention to modeling spatial dependence among the spatial units. The meta-analysis of the literature explains that the ubiquitous 2% convergence result should not be seen as a "natural constant" as it varies systematically across spatial and temporal characteristics of the samples that are being studied, and characteristics of the research design. In addition, work is
underway that addresses the role of technological leadership in explaining catch-up processes in economic growth at the level of US counties. This research shows the importance of distinguishing between geographical and technological distance to the technology leader, and the impact of domestic investment in human capital. Finally, meta-analytical work on economic growth and income equality reveals systematic variation in the literature as to the hypothesized negative link between economic growth and income inequality. The research shows that the use of panel data techniques leads to serious doubts as to whether such a negative association is sustained by empirical realities. In the area of the valuation of ecological externalities work has centered on using meta-analysis to value wetlands, and the willingness to pay for a reduction of pesticide risk. The wetland research is based on the analysis of a very extensive database comprising over 200 wetland valuation studies, and provides
evidence that valuation assessments should not disregard variations in income and population density among respondents. The findings with respect to pesticide risk valuation show that the willingness to pay for reduced risk exposure is approximately 15% greater for medium, and 80% greater for high pesticide risk-levels, as compared to low pesticide risk levels. The income elasticity of pesticide risk exposure is generally positive, although not overly robust. Most results indicate that the demand for human health and environmental safety is highly elastic, and that geographical differences, characteristics of the survey, and the type safety device (eco-labeling, integrated management, or bans) are important drivers of the valuation results. Work on the development of techniques has focused on misspecification testing in linear spatial regression models. In addition, the research has investigated the potential pay-off of using meta-analysis for policy development purposes. Although the
latter is an area with great potential, the use of value transfer in which a result from one policy-site is transferred to another site shows rather disappointing results.
Impacts
The results of the work on economic growth provide evidence for what the bottom-line is in research so far and will provide guidance in future work on economic growth and income inequality. The work also provides context and qualification for policymakers when considering some of the standard results from economic growth theory, such as the 2% convergence rate of economic growth among economies, and the alleged adverse relationship between economic growth and income inequality. Results in the area of the valuation of environmental or ecological externalities shows that the transfer of, for instance, wetland values from one (studied) location to an (unstudied) policy site should be done with great caution, because of inherent differences in socio-economic preferences and characteristics between the two locations. As far as the valuation of pesticide risk is concerned, the research shows that consumers are willing to pay substantially more for a pesticide reduction
policy based on a ban of particular pesticide compounds and substantially less for the adoption of integrated pest management strategies as compared to ecocertification of food commodities.
Publications
- De Dominicis, L., De Groot, H.L.F. and Florax, R.J.G.M. (2006) Growth and Inequality: A Meta-Analysis. Amsterdam: Tinbergen Institute, Discussion Paper TI 2006-064/3.
- Brander, L. and Florax, R.J.G.M. (2006) The Empirics of Wetland Valuation: A Comprehensive Summary and a Meta-Analysis of the Literature. Environmental and Resource Economics 33, 223-250.
- Oltmer, K., Nijkamp, P., Florax, R.J.G.M. and Brouwer, F. (2006) Impactos medioambientales de la politica agroambiental en la Union Europea: una investigacion meta-analitica, in: A. Tarroja and R. Camagni (eds.), Una nueva cultura del territorio: criterios sociales y ambientales en las politicas y el gobierno del territorio. Barcelona: Diputacio de Barcelona, 351-384.
- Florax, R.J.G.M. and Nijkamp, P. (2005) Misspecification in Linear Spatial Regression Models, in: K. Kempf-Leonard (ed.), Encyclopedia of Social Measurement. San Diego: Academic Press, 695-707.
- Florax, R.J.G.M. and De Groot, H.L.F. (2005) Meta-analyse als hulpmiddel bij beleidsinstrumentatie. Economisch Statistische Berichten 90(4461), D8-10.
- Koetse, M., Florax, R.J.G.M. and De Groot, H.L.F. (2005) Correcting for Primary Study Misspecification in Meta-Analysis. Amsterdam: Tinbergen Institute, Discussion Paper TI 2005-029/3.
- Florax, R.J.G.M., Travisi, C. and Nijkamp, P. (2005) A Meta-Analysis of the Willingness to Pay for Reductions in Pesticide Risk Exposure. European Review of Agricultural Economics 32(4), 441-467.
- Brander, L. and Florax, R.J.G.M. (2006, in print) The Valuation of Wetlands: Primary Valuation versus Meta-Analysis Based Value Transfer, in: J.I. Carruthers and B. Mundy (eds.), Environmental Valuation: Interregional and Intraregional Perspectives. Aldershot: Ashgate.
- Mulatu, A., Florax, R.J.G.M. and Withagen, C.A. (2006) Environmental regulation and international trade in Germany, the Netherlands and the US, 1977-1992, in: Don Fullerton (ed.), The Economics of Pollution Havens. Cheltenham: Edward Elgar, 248-276.
- Sa, C., Florax, R.J.G.M. and Rietveld, P. (2006) Does Accessibility to Higher Education Matter? Choice Behavior of High School Graduates in the Netherlands. Spatial Economic Analysis 1(2), 153-172.
- Abreu, M., De Groot, H.L.F. and Florax R.J.G.M. (2005) A Meta-Analysis of b-Convergence: The Legendary 2
- Abreu, M., De Groot, H.L.F. and Florax R.J.G.M. (2005) Space and Growth: A Survey of Empirical Evidence and Methods. Region et Developpement 21, 2005, 13-44.
- Pede, V., Florax, R.J.G.M. and De Groot, H.L.F. (2006) Technological Leadership, Human Capital and Economic Growth: A Spatial Econometric Analysis for US Counties, 1969-2003. West Lafayette: Dept. of Agricultural Economics, Purdue University, Staff Paper 06/09.
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