Papers in Evolutionary Economic Geography

May 9, 2017

# 17.09 Economic Geography in R: Introduction to the EconGeo package

Pierre-Alexandre Balland

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The R statistical software is increasingly used to perform analysis on the spatial distribution of economic activities. It contains state-of-the-art statistical and graphical routines not yet available in other software such as SAS, Stata, or SPSS. R is also free and open-source. Many graduate students and researchers, however, find programming in R either too challenging or end up spending a lot of their precious time solving trivial programming tasks. This paper is a simple introduction on how to do economic geography in R using the EconGeo package (Balland, 2017). Users do not need extensive programming skills to use it. EconGeo allows to easily compute a series of indices commonly used in the fields of economic geography, economic complexity, and evolutionary economics to describe the location, distribution, spatial organization, structure, and complexity of economic activities. Functions include basic spatial indicators such as the location quotient, the Krugman specialization index, the Herfindahl or the Shannon entropy indices but also more advanced functions to compute different forms of normalized relatedness between economic activities or network-based measures of economic complexity. By opening and sharing the codes used to compute popular indicators of the spatial distribution of economic activities, one of the goals of this package is to make peer-reviewed empirical studies more reproducible by a large community of researchers.

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August 29, 2016

# 16.25 Risk-taking, skill diversity, and the quality of human capital: how insurance affects innovation

Filed under: 2016 — Tags: , , , , — mattehartog @ 7:24 pm

Andrea Filippetti, Frederick Guy

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We argue that human capital does a better job of fostering innovation when an economy has a diverse portfolio of specialist skills to draw on. While such a diverse portfolio is beneficial for a country, it includes many individual skill packages that are subject to considerable labour market risk. In the absence of strong income insurance (job security or unemployment insurance), the flight to safety in human capital investments will produce a national skill portfolio which is poorly diversified and less conducive to innovation.
Using country-level data for 25 OECD countries from 1985 to 2009, we find evidence that income insurance raises the marginal effect of human capital on innovation, with the latter measured by patenting. At the same time, we find a direct negative effect of insurance on patenting; at low-medium levels of human capital, the direct negative effect more than offsets the positive indirect effect, while at high levels of human capital the indirect positive effect dominates. We draw implications for income insurance and education policy.

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