On the Value of Homotheticity in the Shift-Share Framework

The purpose of this paper is to examine the usefulness of homothetic reformulations of the shift-share accounting model to the practitioner of regional growth studies. The reformulations of Esteban-Marquillas (1972) and Arcelus (1984) are examined to determine if they improve the shift-share framework as a means for accounting for regional economic growth or decline. The purpose of the homothetic models is to separate out change in a region's employment (or value added) associated with its prior or base year specialization in particular industries from change associated with changes in the mix of industries that occurred during the period under study. It is contended while the resulting accounts may help in understanding individual industry's growth rates, they shed little light on total regional growth. Indiana employment data from 1977 and 1986 are used to illustrate the arguments.     

Dynamic Shift-Share Analysis

Most applications of shift-share analysis to regional employment change have used a study period of several years and have examined conditions only at the beginning and end years. This comparative static approach does not take into account the continuous changes in both industrial mix and size of total employment of the region over the study period. Calculating the national growth effect, the industrial mix effect, and the competitive effect on an annual basis and then summing the results over the study period provides a more accurate allocation of job changes among the three shift-share effects. This approach, which we term dynamic shift-share analysis, also allows unusual years and years of economic transition to he identified. We illustrate the use of dynamic shift-share by presenting results of an analysis of New England employment growth from 1939 to 1984, using U.S. Bureau of Labor Statistics data. The use of the dynamic form of shift-share is important when the study period is characterized by either large changes in regional industrial mix or major differences between regional and national growth rates.     

The Impact of Output and Productivity Changes on Manufacturing Employment

Traditional univariate shift-share studies of employment provide an unreliable indicator of the relative performance of a region or an industry for they fail to separate the effects of output and productivity change on the demand for labor. An extended shift-share model is proposed that overcomes this weakness and permits identification of different processes of regional development. This model is used to investigate annual employment change in twenty (two-digit SIC) manufacturing industries in nine census regions of the U.S. between 1950 and 1986. The timing and depth of the exodus of manufacturing jobs from the snowbelt to the sunbelt is illustrated along with the business cycle performance of industries and regions. Productivity growth in the sunbelt is positively associated with rapid output expansion, whereas in the snowbelt it is associated with the loss of market share and economic rationalization.     

Productivity Change in Manufacturing Regions: A Multifactor/Shift-Share Approach

ABSTRACT The traditional shift-share model measures the combined effects of output growth and productivity change on employment. A region with above average employment growth either has a favorable industry mix or enjoys a competitive advantage over other regions. To separate the effects of output and productivity, the shift-share model is extended to decompose the effects of changes in output and productivity on employment. This paper modifies the Rigby-Anderson extension by separating the contribution of labor and capital to productivity growth in the analysis of regional economic performance, and investigates twenty (two-digit SIC) manufacturing sectors in twelve states (six snowbelt, six sunbelt states) to assess whether observed changes in employment were due to changes in output or to productivity.     

Shift-Share Analysis and the Potential for Predicting Regional Growth Patterns: Some Evidence for the Region of Quebec,Canada

The purpose of this paper is to explain changes in regional attractiveness as measured by the competitive component of the shift-share model. This is done by applying the shift-share model to the manufacturing sector in the province of Quebec and using time series data for twenty two-digit industries as the basis of analysis. The study concludes that shift-share is useful for analyzing historical employment patterns and identifying their causes through regression analysis. However, the inherent structural instability limits the predictive potential of the model.     

Considerations in Extending Shift-Share Analysis: Note

One of the limitations to the widespread use of the Esteban-Marquillas shift-share extension has been the Stokes (1974) proof of the lack of regional additivity of the Esteban-Marquillas competitive components. Since the Arcelus extension (1984) of the traditional shift-share decomposition is a continuation of the logical framework by Esteban-Marquillas (1972), the Stokes criticism would at first appear to have equal relevance to this new work. This note demonstrates that the relationship between the rate of growth of the larger region and the rates of growth of its constituent subregions is ignored in the Stokes criticism and in the subsequent critique by Beaudry and Martin (1979). By explicitly incorporating the relationship between the rate of growth of the larger region and the rates of growth of the constituent subregions, we also demonstrate that the recent shift-share extensions by Esteban-Marquillas and Arcelus share with the classical shift-share decomposition the desirable additive properties under regional disaggregation of the data.     

中部地区产业结构演变与经济增长关系研究

以1995-2009年统计数据为基础,利用偏离-份额分析法（SSM）重点探究了中部地区的产业结构演替与经济增长之间的关系,为各省调整产业结构、促进中部崛起提供理论指导。结果表明：1.中部地区产业结构变化总体与产业结构演进的一般规律相符。2.中部地区产业结构演替对经济发展的影响情况分为：江西和安徽产业结构偏离为负,竞争力偏离份额为负;山西和河南产业结构偏离为正,竞争力偏离份额为负;湖北和湖南产业结构偏离为负,竞争力偏离份额为正等3种类型。3.产业结构变迁对各省经济增长的影响差异较大。     

Weighted spatial dynamic shift-share model as a forecasting tool for a regional economy: The case of South Korea

This study proposes a weighted spatial dynamic shift-share model that considers two regional attributes, namely, interregional interactions and regional receptive capabilities for domestic and international economic change, to improve the forecasting capability of the traditional shift-share model. In particular, the spatial dependence among regions is embodied by a spatial weight matrix based on contiguity. Additionally, regional receptive capabilities are represented by weights imposed on regional industries. Forecasts over the period of 2014–2016 are made for 14 regions in South Korea using the proposed model. The results are compared with actual data from the same period and evaluated in terms of the mean absolute percentage error. The results indicate that the proposed model is more reliable and accurate than the traditional model and other dynamic extensions.     

The Growing Economic Specialization of Cities: Disentangling Industrial and Functional Dimensions in the Canadian Urban System, 1971–2006

Decreasing spatial transaction and trade costs have given rise to growing economic specialization of cities. While most studies focus on industries as the primary manifestation of urban specialization, a growing body of literature examines occupational functions, i.e., activities and tasks performed within a given industry or firm. This paper explores how the two dimensions (industries and functions) interact across the urban system and their relative importance over time. Is there a trend toward increasing functional specialization in the Canadian urban system? How much of this phenomenon is attributable to spatial shifts in regional industrial structures as opposed to spatial divisions within industries? The paper uses a unique data set drawn from Statistics Canada Census microdata files between 1971 and 2006. Based on the employed population, the data are spatially organized and cross‐tabulated over industries and occupational groups. A decomposition methodology is used to compare the relative weights of industry and regional (functional) effects in accounting for the changing spatial division of functions across Canadian urban areas. Clear patterns of increasing functional specialization are found within the Canadian urban system. Regional effects are generally greater than industry effects, suggesting that spatial divisions of functions (spatial shifts within industries) are progressing more rapidly than regional shifts in industrial structure.     

Industrial Structure and the Sources of Agglomeration Economies: Evidence from Manufacturing Plant Production

The impacts of agglomeration and local industrial structure are examined through an analysis of establishment‐level productivity. Using micro‐level data, measures of regional industrial specialization, economic diversity, and industrial competitive structure are incorporated together into a production function system estimated cross‐sectionally for three years and three manufacturing industries in the U.S. The findings demonstrate the importance of the influences of regional industrial competitive structure and diversity on performance.     

Spatial Industrial Dynamics in Sweden: Urban Growth Industries

In this paper two basic theories within spatial industrial dynamics—the filtering-down theory and the spatial product cycle theory—are used to explain processes of spatial decentralization and centralization of economic activities. In particular, a case is made for the idea that employment decentralization should be expected not only for growing and maturing manufacturing industries but also for growing and maturing service industries. Based upon this theoretical framework the empirical part of the paper analysis the spatial behavior during the period 1980 to 1993 of the employment in a group of 19 industries in Sweden—the so-called urban growth industries—with an expected high potential for employment decentralization. Most of the industries exhibited the expected pattern of employment decentralization with the larger medium-sized regions as the main winners. A shift-share analysis shows that the overall magnitudes of the competitive shift components are rather small and that, hence, Sweden during the period 1980–1993 did not experience a drastic change in the spatial distribution of its urban growth industries.     

Towards Modeling National Preference Formation for Regional Development Policy: Lessons from Developed and Less Developed Countries

National preferences for the development of regional and environmental policy are dependent on the competitive resolution of priorities emanating from four national centers of preference formation, namely: (a) national opinion leaders, (b) society at large, (c) state political institutions, and (d) the private business sector. The viability of national policies for regional development and environmental protection is assumed to be a function of the degree of systemic concordance among these four competing loci of preference formation. The paper explores differences between developed and developing countries in the formation of national preferences and analyzes the process by which competing preferences for regional development and environmental protection are ultimately resolved. It demonstrates that MDCs enjoy a high degree of harmony among their more autonomous centers of preference formation to achieve regional development goals, whereas LDCs are constrained by the dominant and coercive role of the state apparatus.     

The Successful Transition to a Knowledge‐Based Development Path of a Less‐Developed Region

This paper presents the case of a less‐developed EU region—the Pomeranian region of Poland—that is, an example of the successful transformation from a command to market economy and the creation of a new knowledge‐based development path thanks to the upgrading of its innovation model. This successful transformation was based, in part, on the region's specific innovation policy and the activities of pro‐innovative institutions; however, other factors were also important such as the diversified structure of the region's economy. New knowledge‐based industries have developed in the region, while the potential of traditional industries that have gone through a restructuring, has been maintained. The factors that existed prior to the innovation model's transformation included such aspects as the high quality of human and social capital, a strong academic center, a high quality of life, and an open economy and society. Supply factors in the form of qualified personnel were crucial for the growth of employment in new industries and R&D that determined the improvement of the regional GDP per capita. Moreover, the transition to a knowledge‐based economy stimulated an increase in the concentration of population in the metropolitan area of Tri‐City.     

Division of Labor and Allocation of Property Rights with Transaction Costs

This paper addresses the question produced when the control over nonhuman resources affect division of labor based on specialization. In a simple economy with two final goods and a nonhuman resource as an initial input of production, it is proved by using the new classical microeconomic method that readjusting the initial allocation of property rights can help push the division development of labor, although the ex post transaction costs will increase. The model shows that it is an improper division of labor that the Government directly involves itself in production by founding state owned enterprises, and these enterprises at least should withdraw from competitive industries.     

A Note on Localization and Specialization

ABSTRACT Analysts and policy makers frequently measure industrial localization and regional specialization. However, they rarely examine the nation's full array of industries or regions. So local indices, appropriate for specific industries or selected regions, are typically estimated. But in some instances global indices would be preferable in order to assess the wider features of the entire space‐economy. This article constructs global indices from the local indices already used in assessing localization and specialization. Global localization and global specialization are shown to be identical when all local indices use the dissimilarity logic. Two‐digit standard industry codes manufacturing data, taken from the U.S. during 1958–1995, are used to illustrate the results. The values of these global coefficients, like their local constituents, are shown to vary with geographic scale. The discussion addresses spatial distributions (evenness) but not geographic arrangements (clustering).     

基于主成分和GIS 的关天经济区区域经济空间分异研究

在关中-天水经济区＂一核、一轴、三辐射＂的空间发展战略基础上,对经济区县域生产要素禀赋和生产技术水平等基本特征进行综合评价,据此划分区域并进行各区产业功能定位,以期为促进产业整合与升级和优化区域经济结构提供科学依据。运用多元统计的主成分分析,对研究区65个区（县）经济发展状况进行综合评价;运用区域分工指数和区位商衡量各县之间的产业集聚趋势,采用层次聚类法和GIS空间分析将经济区划分为5个区域;最后提出促进经济区地区分工及一体化,统筹区域经济发展的对策建议。     

陕西省农业经济发展的时空差异演变研究

为了研究陕西省农业经济发展差异的特征,推动区域农业经济均衡发展,依据陕西省各市农林牧渔业总产值,运用极差、标准差、变异系数对陕西省农业经济的差异进行测算,分析农业经济差异在时间和空间上的演变特征。结果显示：（1）2001—2013 年陕西省农业经济发展经历了4 个阶段,不同阶段的增长速度存在差异;（2）三大地区的农业经济比重发生了明显变化,关中地区比重略有下降,陕南地区比重减少了3.09%,陕北地区比重提高了4.10%;（3）市域间农业经济发展水平的绝对差距不断扩大,相 对差距波动变化;（4）三大地区内部农业经济的相对差距变化出现分化,陕南地区的相对差距缓慢小幅扩大,关中地区保持稳定,陕北地区的相对差距先迅速减少后缓慢扩大。各个地区应充分发挥资源优势,发展特色农业,提高农业竞争力。     

Growth‐Oriented Small Firms and the Nature and Extent of Local Embeddedness: The Case of a Traditional Metalworking Cluster

ABSTRACT Clusters now form a central element in many regional economic development policies. Location within a cluster of related industries is thought to increase a firm's competitive advantage resulting in higher output and productivity growth rates than in similar firms located beyond the cluster. This study focuses on owner‐managers operating small firms within a traditional cluster of metalworking industries and empirically examines the relationship between growth‐orientation and the extent and nature of cluster embeddedness. The results indicate only a limited number of differences in growth‐orientation given variations in levels of cluster embeddedness. Contrary to conventional wisdom, many of the most growth‐oriented entrepreneurs focus their activities outside the cluster, especially in terms of market‐based linkages. However, those firms with more advanced process technologies do tend to show above average within cluster linkages.     

Defense Impact Analysis Within a social Accounting Framework

This paper uses a social accounting matrix (SAM) of the California economy to evaluate (1) industrial-occupational linkages associated with defense production, and (2) the relative impact of defense expenditures in a regional economy. Multipliers derived from the SAM are used to trace the distribution of wages and salaries payments from 24 industries to managerial, professional, skilled, and unskilled sectors of the labor force. Expenditures by federal defense and non-defense sectors and households are used to assess the relative impacts of defense spending in the overall regional economy. The results indicate that duality is prevalent in the regional labor market, with managerial and professional occupations receiving the greatest benefits from defense production. Overall impacts to the regional economy are less attributable to defense spending than non-defense and household sectors.     

Global Markets and the Role of Geographical Proximity in Mexico's Employment Growth

In the context of greater economic integration with global markets and structural economic reforms, this paper analyses regional and sectoral employment growth dynamics in Mexican states between 2004 and 2014. The methodology is based on spatial shift‐share analysis that explicitly considers interregional interactions in employment while assessing potential spillover effects arising from spatial interactions among states and industrial sectors. The results suggest a competitive effect from some industries—such as those related to science and specialized suppliers, intensive scale industries and dominated providers—which led to the formation of industrial corridors of neighboring states that connect the central region with the northeast region of the country. It was also found that proximity to states such as Nuevo Leon, Queretaro, Guanajuato, San Luis Potosi, and Puebla has positively influenced neighboring states in terms of employment growth rates. The results also support the argument of some sort of de‐concentration of economic activity in the capital, Mexico City, toward neighboring states.