Raising the bar (11)

This editorial summarizes the papers published in issue 14(2) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper deals with past and current challenges for regional science research. The second paper investigates whether people living in deprived neighbourhoods have less chance of succeeding in a job application. The third paper finds evidence that real estate firms can avoid price competition when market shares of their allies increase in the vicinity. The fourth paper is methodological: it considers a spatial autoregressive (SAR) model with heterogeneous coefficients and extensively analyzes the impact of this extension on the direct and indirect effects estimates. The fifth paper proposes an innovative method to estimate the elements of the spatial weight matrix in a spatial econometric model. The final paper is econometric–theoretical: it proposes a new generalized method of moments (GMM) estimator of the coefficients of a SAR model if the error terms are heteroskedastic of an unknown form.     

Raising the bar (7)

This editorial summarises the papers published in issue 13.1 so as to raise the bar in applied spatial economic research and highlight new trends. The first paper adopts a scale neutral approach to investigate the spatial mechanisms that cause regional innovation and growth. The second paper claims that population-weighting when calculating indices of regional inequality might lead to inconsistent outcomes. The third paper estimates the effect of distance between family residence and higher education institution on a student's academic performance, thereby accounting for endogenous regressors. The fourth paper shows an inverted U-shaped relationship between economic development at region of origin and the propensity to migrate using a multilevel approach. The fifth paper provides spatial econometric evidence of price competition between sellers of used books on Amazon.com. The last paper estimates a hedonic housing price equation and parameterizes the spatial weight matrix to determine how far back in time buyers, sellers and realtors are looking at the housing market.     

Choosing and sharing

Implementing a project, like a nationwide nuclear waste disposal, which benefits all involved agents but brings major costs only to the host is often problematic. In practice, revelation issues and redistributional concerns are significant obstacles to achieving stable agreements. We address these issues by proposing the first mechanism to select the efficient site (the host with the lowest cost) while simultaneously allowing for the implementation of any individually rational division of the whole hosting cost. The subgame perfect Nash equilibria of our simple mechanism are efficient, budget-balanced and individually rational. Moreover, the truthful equilibrium is immune to coalitional deviations.     

COMPARING FEDERAL AND PRIVATE‐SECTOR WAGES WITHOUT LOGS

I use Current Population Survey data from 2005 through 2010 to compare the wages of federal employees and workers in the private sector who have similar observable characteristics. The distribution of wages differed drastically between the federal and private sectors. In particular, I find that federal employees with no more than a high school diploma earned 21% more, on average, than their private‐sector counterparts, whereas those with a professional degree or doctorate earned 23% less. Overall, the average of federal wages was about 2% higher than the average wage of similar private‐sector workers. Other researchers have found larger differences because they used log‐linearized models, which result in comparisons of geometric means. I show that arithmetic means are more relevant in the context of the relationship between a government's compensation policy and its budget. The discrepancy between differences in arithmetic and geometric means occurs because the wages of federal employees were much less dispersed than those of employees with similar characteristics in the private sector. (JEL J31, J38, J45)     

Profit sharing in unique Nash equilibrium: Characterization in the two-agent case

Two agents jointly operate a decreasing marginal returns technology to produce a private good. We characterize the class of output-sharing rules for which the labor-supply game has a unique Nash equilibrium. It consists of two families: rules of the serial type which protect a small user from the negative externality imposed by a large user, and rules of the reverse serial type, where one agent effectively employs the other agent's labor. Exactly two rules satisfy symmetry; a result in sharp contrast with Moulin and Shenker's characterization of their serial mechanism as the unique cost-sharing rule satisfying the same incentives property [Moulin, H., Shenker, S., 1992. Serial cost sharing. Econometrica 60 (5), 1009–1037]. We also show that the familiar stand-alone test characterizes the class of fixed-path methods under our incentives criterion [Friedman, E.J., 2004. Strong monotonicity in surplus sharing. Econ. Theory 23, 643–658].     

Cost-effectiveness of Access to Critical Cerebral Emergency Support Services (ACCESS): a neuro-emergent telemedicine consultation program

Aims: Access to Critical Cerebral Emergency Support Services (ACCESS) was developed as a low-cost solution to providing neuro-emergent consultations to rural hospitals in New Mexico that do not offer comprehensive stroke care. ACCESS is a two-way audio-visual program linking remote emergency department physicians and their patients to stroke specialists. ACCESS also has an education component in which hospitals receive training from stroke specialists on the triage and treatment of patients. This study assessed the clinical and economic outcomes of the ACCESS program in providing services to rural New Mexico from a healthcare payer perspective.

Methods: A decision tree model was constructed using findings from the ACCESS program and existing literature, the likelihood that a patient will receive a tissue plasminogen activator (tPA), cost of care, and resulting quality adjusted life years (QALYs). Data from the ACCESS program includes emergency room patients in rural New Mexico from May 2015 to August 2016. Outcomes and costs have been estimated for patients who were taken to a hospital providing neurological telecare and patients who were not.

Results: The use of ACCESS decreased neuro-emergent stroke patient transfers from rural hospitals to urban settings from 85% to 5% (no tPA) and 90% to 23% (tPA), while stroke specialist reading of patient CT/MRI imaging within 3?h of onset of stroke symptoms increased from 2% to 22%. Results indicate that use of ACCESS has the potential to save $4,241 ($3,952–$4,438) per patient and increase QALYs by 0.20 (0.14–0.22). This increase in QALYs equates to ～73 more days of life at full health. The cost savings and QALYs are expected to increase when moving from a 90-day model to a lifetime model.

Conclusion: The analysis demonstrates potential savings and improved quality-of-life associated with the use of ACCESS for patients presenting to rural hospitals with acute ischemic stroke (AIS).     

Inter- and Intra-Organizational Knowledge Transfer: A Meta-Analytic Review and Assessment of its Antecedents and Consequences

abstract    Research on organizational knowledge transfer is burgeoning, and yet our understanding of its antecedents and consequences remains rather unclear. Although conceptual and qualitative reviews of the organizational knowledge transfer literature have emerged, no study has attempted to summarize previous quantitative empirical findings. As a first step towards that goal, we use meta-analytic techniques to examine how knowledge, organization and network level antecedents differentially impact organizational knowledge transfer. Additionally, we consolidate research on the relationship between knowledge transfer and its consequences. We also demonstrate how the intra- and inter-organizational context, the directionality of knowledge transfers, and measurement characteristics moderate the relationships studied. By aggregating and consolidating existing research, our study not only reveals new insights into the levers and outcomes of organizational knowledge transfer, but also provides meaningful directions for future research.     

Information, Informal Finance, and SME Financing

Informal finance exists extensively and has been playing an important role in small- and medium-sized enterprise (SME) financing in developing economies. This paper tries to rationalize the extensiveness of informal finance. SME financing suffers more serious information asymmetry to the extent that most SMEs are more opaque and can only provide less collateral. Informal lenders have an advantage over formal financial institutions in collecting “soft information” about SME borrowers. This paper establishes a model including formal and informal lenders and high- and low-risk borrowers with or without sufficient collateral and shows that the credit market in which informal finance is eliminated will allocate funds in some inefficient way, and the efficiency of allocating credit funds can be improved once informal finance is allowed to coexist with formal finance. Translated from Economic Research Journal, 2005, 7 (in Chinese)     

Growth of industry clusters and innovation: Lessons from Beijing Zhongguancun Science Park

The success of technology parks in promoting technology transfer and attracting clusters of highly innovative firms has motivated countries from around the world in an attempt to promote regional development, including the People's Republic of China. Due to its similarities with other formerly planned economies undergoing transition towards market economies, the Chinese model of technology parks has been closely watched and emulated by other transitional economies. However, despite its economic significance, such development has been largely ignored in organizational research.In this study, I investigate a specific example of an industry cluster in China, the Beijing Zhongguancun (ZGC) Science Park, which has seen the largest cluster of semiconductor, computer, and telecommunication firms in China, consisting of both domestic and foreign invested firms. I examine the origin and growth of industry cluster in a traditionally heavily regulated economy and region, its role in promoting technology transfer and innovation, and challenges firms face in the future. I close by proposing some issues for future research.     

Estimating demand systems when outcomes are correlated counts

We describe and employ a Bayesian posterior simulator for fitting a high-dimensional system of ordinal or count outcome equations. The model is then applied to describe the multiple site recreation demands of individual agents, and we argue that our approach provides advantages relative to existing methods commonly applied in this area. In particular, our model flexibly adjusts to match observed frequencies in trip outcomes, permits a flexible correlation pattern among the sites visited by individuals, and the posterior simulator for fitting this model is relatively easy to implement in practice. We also describe how the posterior simulations produced from the model can be used to conduct a variety of counterfactual experiments, including predicting behavioral changes and describing welfare implications resulting from shifts in exogenous demographic and site characteristics. We illustrate our method using data from the Iowa Lakes Project by modeling the visitation patterns of individuals to a set of twenty-nine large Iowa lakes. Consistent with previous findings in the literature, we see strong evidence that own and cross-price effects on trip demand are negative and positive, respectively, that higher income increases the likelihood of visiting most sites, and that a commonly used indicator of water quality, Secchi transparency, is positively correlated with the number of trips taken. In addition, the correlation structure among the errors reveals a complex pattern in which unobserved factors affecting trip demand are generally (though not strictly) positively correlated across sites. The flexibility and richness with which we are able to characterize the demand system provides a solid platform for counterfactual analysis, where we find significant behavioral and welfare effects from changes in site availability, water quality, and travel costs.