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The Importance of Spatial Autocorrelation for Regional Employment Growth in Germany

Author

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  • Ulrich Zierahn

    (University of Kassel and Hamburg Institute of International Economics)

Abstract
In analyzing the disparities of the regional developments in the volume of employment in Germany, in the recent empirical literature so called shift-share-regression-models are frequently applied. However, these models usually neglect spatial interdependencies, even though such interdependencies are likely to occur on a regional level. Therefore, this paper focuses on the importance of spatial dependencies using spatial autocorrelation in order to analyze regional employment development. Spatial dependency in the form of spatial lag, spatial error and cross regressive model are compared. The results indicate that the exogenous variables’ spatial lag sufficiently explains the spatial autocorrelation of regional employment growth.

Suggested Citation

  • Ulrich Zierahn, 2010. "The Importance of Spatial Autocorrelation for Regional Employment Growth in Germany," MAGKS Papers on Economics 201031, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    • Handle: RePEc:mar:magkse:201031
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    References listed on IDEAS

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    1. Blien, Uwe & Suedekum, Jens & Wolf, Katja, 2006. "Local employment growth in West Germany: A dynamic panel approach," Labour Economics, Elsevier, vol. 13(4), pages 445-458, August.
    2. Reinhold Kosfeld & Christian Dreger, 2006. "Thresholds for employment and unemployment: A spatial analysis of German regional labour markets, 1992–2000," Papers in Regional Science, Wiley Blackwell, vol. 85(4), pages 523-542, November.
    3. Niebuhr, Annekatrin, 2000. "Raumliche Wachstumszusammenhange - Empirische Befunde Fur Deutschland," Discussion Paper Series 26191, Hamburg Institute of International Economics.
    4. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
    5. Jens Suedekum & Uwe Blien, 2007. "Stimulating Employment Growth with Higher Wages? A New Approach to Addressing an Old Controversy," Kyklos, Wiley Blackwell, vol. 60(3), pages 441-464, August.
    6. Uwe Blien & Katja Wolf, 2002. "Regional development of employment in eastern Germany: an analysis with an econometric analogue to shift-share techniques," Papers in Regional Science, Springer;Regional Science Association International, vol. 81(3), pages 391-414.
    7. Jens Suedekum & Uwe Blien, 2004. "Wages and Employment Growth: Disaggregated Evidence for West Germany," ERSA conference papers ersa04p641, European Regional Science Association.
    8. Peter Nijkamp & Jacques Poot, 1998. "original: Spatial perspectives on new theories of economic growth," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 32(1), pages 7-37.
    9. Eileen Appelbaum & Ronald Schettkat, 1994. "The end of full employment? On economic development in industrialized countries," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 29(3), pages 122-130, May.
    10. Jens Suedekum & Uwe Blien & Johannes Ludsteck, 2006. "What has caused regional employment growth differences in Eastern Germany?," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 26(1), pages 51-73, March.
    11. Jürgen Jerger & Jochen Michaelis, 2003. "Wage Hikes as Supply and Demand Shock," Metroeconomica, Wiley Blackwell, vol. 54(4), pages 434-457, November.
    12. repec:bla:scandj:v:92:y:1990:i:2:p:215-35 is not listed on IDEAS
    13. Reinhold Kosfeld & Hans-Friedrich Eckey & Jorgen Lauridsen, 2008. "Disparities in Prices and Income across German NUTS 3 Regions," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot, Berlin, vol. 54(2), pages 123-141.
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    Cited by:

    1. Pietro Pizzuto, 2020. "The role of regional competitiveness in shaping the heterogeneous impact of the Great Recession," Regional Science Policy & Practice, Wiley Blackwell, vol. 12(2), pages 267-290, April.
    2. Matthias Firgo & Oliver Fritz, 2017. "Does having the right visitor mix do the job? Applying an econometric shift-share model to regional tourism developments," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 58(3), pages 469-490, May.
    3. Uwe Blien & Lutz Eigenhueller & Markus Promberger & Norbert Schanne, 2013. "The Shift-Share Regression: An Application to Regional Employ-ment Development," ERSA conference papers ersa13p614, European Regional Science Association.
    4. Oberst, Christian & Oelgemöller, Jens, 2013. "Economic Growth and Regional Labor Market Development in German Regions: Okun’s Law in a Spatial Context," FCN Working Papers 5/2013, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN).

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    More about this item

    Keywords

    spatial interdependency; spatial autocorrelation; shift-share-regression; regional employment growth;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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