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Title:Essays in economic geography: Convergence, inequalities and innovations in the knowledge economy
Author(s):Galvis, Luis A.
Director of Research:Hewings, Geoffrey J.D.
Doctoral Committee Chair(s):Hewings, Geoffrey J.D.
Doctoral Committee Member(s):McLafferty, Sara L.; Wilson, David; Hannon, Bruce M.
Department / Program:Geography
Degree Granting Institution:University of Illinois at Urbana-Champaign
Subject(s):Labor market
spatial econometrics
Abstract:My dissertation consists of four papers embedded within the Economic Geography field. The first paper analyzes economic growth and convergence from a time series perspective focusing on regional labor markets. The second paper uses microdata to evaluate what is termed conditional sigma convergence. Finally, the third paper uses innovations, as proxied by patents, and studies determinants of innovation intensity in reference to measures of human capital and economic structure such as the degree of specialization, and competitiveness. Each chapter contains a review of the relevant literature. The paper entitled “Regional Economic Development and Regional Policies in Colombia”, begins by discussing regional imbalances in the last three decades in Colombia. The paper reviews the process by which Colombia is evolving to a pattern that consists of having a single, large metropolis, in this case Bogotá, a pattern that is typical of the Latin American experience. The paper argues that economic policies have not helped in achieving a more balanced spatial pattern of economic development. Instead, most of the economic policies seem to have worsened the situation as they have privileged the core of the country. The paper entitled “Stochastic Convergence and Regional Disparities: An Application to Urban Wages in Colombia” develops a model for real wages in Colombian metropolitan areas to evaluate the existence of real wage convergence, as predicted by neoclassical theory. The study employs what is termed "Stochastic Convergence" to evaluate whether real wages are converging or not. The major findings indicate that there exist differences in mean wages across urban areas, which persist through time even when accounting for differences in living costs. The analysis of stochastic convergence reveals that those differences are not vanishing through time. From a policy perspective, the results found are not encouraging given that the greatest wage disparities are more salient in the more impoverished regions such as the city of Barranquilla in the Caribbean Coast and Pasto in the southern part of the country. In the paper “Real Wages in Colombia: A Convergence Conditional Analysis: 1984-2009”, the convergence hypothesis is studied from a different perspective than has traditionally been done in Colombia. Previous studies in Colombia have used aggregate or average income, whereas this study uses micro-data and employs hedonic models. It is argued that a model based on micro-data shows more complete results, allowing a more specific interpretation of the determinants in the difference of urban wages. The results indicate that the wage differentials in urban zones are persistent over time, even when controlling for variation in the cost of living which is used to generate real wages. This raises additional concerns: whether the difference continues after taking into account variables which represent the characteristics of workers (Mincer, 1974), the economic sector (Hewings, 1977), and sample selection bias (Heckman 1979), among others. Once these factors are considered in a hedonic model, the differential of the remaining wages can be interpreted as the existing inequality in wages among urban labor markets in the country. Results from a Mincer-type model that is used to study the microeconomic determinants of wages, indicate that, after controlling for those determinants in the wage equation, significant differentials remain and in some cases are growing over time. This provides evidence to reject the hypothesis of conditional sigma convergence in real wages for the principal cities in the country and also points to the existence of regional wage inequalities. In the paper “Innovation and Geography: an Exploratory Analysis of Patents in the U.S.”, the purpose is to assess the extent to which innovation is affected by the structure of the economy in terms of the industrial specialization, diversity and competition. Innovation is proxied by the number of patents registered in the U.S.. Preliminary analysis of data for the year 2000 reveals that there may be some spatial heterogeneity in the model. Based on that, a Geographically Weighted Regression approach is used to evaluate the space-varying coefficients.
Issue Date:2011-01-21
Rights Information:Copyright 2010 Luis Armando Galvis
Date Available in IDEALS:2011-01-21
Date Deposited:2010-12

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