# 23.01 Foreign Direct Investment (FDI) Spillovers in Visegrad Countries

Eristian Wibisono 

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Macroeconomic and microeconomic literature has raised the impact of FDI knowledge and technology spillovers in the host economy. However, there is still a research gap in addressing this topic in the knowledge economy. Based on a comprehensive literature review, this paper demonstrates the performance of FDI spillovers and their impact on the productivity of domestic firms in emerging and transition economies in Europe. Poland is the largest country in the Visegrad group but provides limited studies on FDI experience. The paper then shows the geographic distribution of FDI across Polish regions, where the western and eastern regions appear very different. There is a significant positive impact of FDI presence on the productivity of foreign-affiliated domestic firms. Unfortunately, the presence of FDI in these regions is not significant enough to induce knowledge and technology spillovers to improve firm productivity. The effectiveness of FDI knowledge and technology in boosting the productivity of the local economy may be worth questioning. Therefore, comparable spatial studies are encouraged to be conducted in future research with a more complete and robust data structure which is recognized as a limitation of this study. 

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# 22.32 Amenity complexity and urban locations of socio-economic mixing

Sándor Juhász, Gergo Pintér, Ádám Kovács, Endre Borza, Gergely Mónus, László Lorincz, and Balázs Lengyel

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Cities host diverse people and their mixing is the engine of prosperity. In turn, segregation and inequalities are common features of most cities and locations that enable the meeting of people with different socio-economic status are key for urban inclusion. In this study, we adopt the concept of economic complexity to quantify the ability of locations – on the level of neigh- borhoods and amenities – to attract diverse visitors from various socio-economic backgrounds across the city. Utilizing the spatial distribution of point of interests inside the city of Budapest, Hungary, we construct the measures of amenity complexity based on the local portfolio of di- verse and non-ubiquitous amenities. We investigate mixing patterns at visited third places by tracing the daily mobility of individuals and characterizing their socio-economic status by the real-estate price of their home locations. Results suggest that measures of ubiquity and diversity of amenities do not, but amenity complexity correlates with the diversity of visitors to neigh- borhoods and to actual amenities alike. We demonstrate that, in this monocentric city, amenity complexity is correlated with the relative geographic centrality of locations, which in itself is a strong predictor of socio-economic mixing. Our work combines urban mobility data with economic complexity thinking to show that the diversity of non-ubiquitous amenities, central locations, and the potentials for socio-economic mixing are interrelated.

# 22.31 The Role of Immigrants, Emigrants, and Locals in the Historical Formation of Knowledge Agglomerations

Viktor Stojkoski, Philipp Koch & César A. Hidalgo

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Did migrants help make Paris a center for the arts and Vienna a beacon of classical music? Or was the rise of these knowledge agglomerations a sole consequence of local actors? Here, we use data on the biographies of more than 22,000 famous historical individuals born between the years 1000 and 2000 to estimate the contribution of famous immigrants, emigrants, and locals to the knowledge specializations of European regions. We find that the probability that a region develops a specialization in a new activity (physics, philosophy, painting, music, etc.) grows with the presence of immigrants with knowledge on that activity and of immigrants specialized in related activities. We also find that the probability that a region loses one of its existing areas of specialization decreases with the presence of immigrants specialized in that activity and in related activities. In contrast, we do not find robust evidence that locals with related knowledge play a statistically significant role in a region entering or exiting a new specialization. These findings advance our understanding of the role of migration in the historical formation of knowledge agglomerations.

# 22.30 The Policy Implications of Economic Complexity

César A. Hidalgo

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In recent years economic complexity has grown into an active field of fundamental and applied research. Yet, despite important advances, the policy implications of economic complexity remain unclear. Here I organize the policy implications of economic complexity in a framework grounded on 4 Ws: what approaches, focused on identifying target activities and/or locations; when approaches, focused on when to time support for developing related and unrelated activities; where approaches, focused on the geographic diffusion of knowledge; and who approaches, focused on the role played by agents of structural change. The goal of this framework is to clarify the policy implications of recent work in economic complexity and to facilitate its continued use in regional and international development efforts.

# 22.29 Knowledge is non-fungible

César A. Hidalgo

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What would you do if you were asked to “add” knowledge?* Would you say that “one plus one knowledge” is two “knowledges”? Less than that? More? Or something in between? Adding knowledge sounds strange, but it brings to the forefront questions that are as fundamental as they are eclectic. These are questions about the nature of knowledge and about the use of mathematics to model reality. In this chapter, I explore the mathematics of adding knowledge starting from what I believe is an overlooked but key observation: the idea that knowledge is non-fungible.

# 22.28 Multidimensional Economic Complexity: How the Geography of Trade, Technology, and Research Explain Inclusive Green Growth

Viktor Stojkoski, Philipp Koch & César A. Hidalgo

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To achieve inclusive green growth, countries need to consider a multiplicity of economic, social, and environmental factors. These are often captured by metrics of economic complexity derived from the geography of trade, thus missing key information on innovative activities. To bridge this gap, we combine trade data with data on patent applications and research publications to build models that significantly and robustly improve the ability of economic complexity metrics to explain international variations in inclusive green growth. We show that measures of complexity built on trade and patent data combine to explain future economic growth and income inequality and that countries that score high in all three metrics tend to exhibit lower emission intensities. These findings illustrate how the geography of trade, technology, and research combine to explain inclusive green growth.

# 22. 27 Innovation and competitiveness: the regional dimension

Milene Simone Tessarin & Carlos Roberto Azzoni

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This study explores the importance of labour pool and geographical concentration as essential factors that help shape pathways for innovation and influence the speed with which technological change can occur. To do so, we propose an approach based on human capital and the workers’ skills that contribute to innovation. Being able to capture this broader range of professionals is crucial to assess regional innovation in Less Developed Countries, such as Brazil and other Latin American countries, as their productive structure concentrates on lower technological industries and innovative activities not centred on R&D. We created a measure of innovative potential that can be used at different levels of regional disaggregation. We analyze 374 relevant Brazilian Labour Market Areas (LMA), employing data on occupations from the Annual Report of Social Information, from 2003 to 2018. Although innovative activities are heavily concentrated in a few regions, empirical evidence suggests that a shift has occurred since the early 2000s, with lagging regions making progress faster. Nonetheless, our results show that such convergence is still slight, given the distance between the leading and lagging regions’ innovative performance. Factors related to the region’s previous capacities, such as the stock of workers with innovative skills, manufacturing industry share, and the number of large firms have a positive association with innovative activity in a region. Although the convergence in the innovative potential among Brazilian regions, the movement is too slow to indicate a transformation of the country as a whole to levels similar to those of developed

# 22.26 Environmental Regulation promotes Green Technological Diversification: Evidence from Chinese Cities

Zhaoyingzi Dong, Siqi Sun, Pierre-Alexandre Balland & Weiwen Zhang 

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Accelerating the development of green technologies is essential to achieve a green transition, but green technologies tend to be more radical and complex. It means that they require significant efforts to scale and we need to understand all possible levers of green technological change. In this paper, we investigate whether environmental regulation can provide opportunities for path-breakthrough and complex technology diversification during the green transition process. The analysis is based on patenting activities in Chinese cities from 2003 to 2016. Our results show that cities with tighter environmental regulations are more likely to branch into new green technology spaces. In addition, environmental regulations help cities enter less related and more complex green domains. This study provides significant policy implications for the green transition literature.

# 22.25 Green technology and income inequality: an empirical analysis of US Metro Areas

Nicolò Barbieri, Davide Consoli, Giovanni Marin & François Perruchas

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Climate change is a global phenomenon with markedly local manifestations. Accordingly, territories differ in terms of exposure to climate events, of capacity to adopt climate mitigation policies and of the welfare effects that these deep transformations entail. The paper brings together these threads with an empirical study of the relationship between green technology development and income inequality in US Metropolitan Areas over the period 2005-2015. We find a positive association between local patenting capacity and growing income gaps to the detriment of the least affluent. Further, higher patenting propensity in early stage technologies has a stronger association with income inequality, whereas such a relationship dissipates at later stages of the life cycle.

# 22.24 Saved by the news? COVID–19 in German news and its relationship with regional mobility behavior

Burcu Ozgun & Tom Broekel

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There are substantial differences across regions regarding COVID–19 infections and deaths, which are partly explained by differences in practicing social distancing. In this paper, we argue that the portrayal of COVID–19 in regional media might be an important factor in explaining regional differences in social distancing. By using mobility as a proxy, and analyzing data on regional news coverage in Germany, we empirically investigate whether the geographical heterogeneity in COVID–19-related news reporting has translated into spatial variations in social distancing. Our results confirm that the frequency of and the element of fear in COVID–19 news has a significant albeit time-varying relationship with social distancing.