INTERDEPENDENT BEHAVIOR WITH RELOCATION COSTS: THE COMPARATIVE STATICS OF SPATIAL HISTORY*

Relocation costs are a form of sunk costs because they are relevant to new entrants, not to agents at their existing locations. With sufficiently high relocation costs, initial (historically given) locations and other conditions determine the equilibrium assignment of agents to locations. Comparative static results depend on initial conditions, i.e., history matters and historical persistence can be characterized. The model suggests empirically-relevant results which can be tested by collecting data on relocation and transportation costs. For example, appropriate levels of these costs imply that suburbanization always occurs with the entry of new firms. Sequential entry strategies may be adopted by existing firms which earn pure profits. This may be contrasted with traditional NUE models which predict changes in the boundaries of central zones.     

FIRM HETEROGENEITY,MULTIPLANT CHOICE,AND AGGLOMERATION

We examine the organization and location choice of heterogeneous firms in a two‐region economy. When some high‐productivity firms engage in multiplant production, a reduction in transport costs causes two changes in a small region: the closure of plants by high‐productivity multiplant firms and the relocation of low‐productivity single‐plant firms to the region. In the presence of high‐productivity multiplant firms, therefore, a decline in transport costs reinforces the spatial sorting of firms by productivity, enlarging the productivity gap between large and small regions. Conversely, reducing investment costs weakens the spatial sorting effects on regional productivity disparities.     

HEGEL AND PATHOLOGIZED MODERNITY,OR THE END OF SPIRIT IN THE ANTHROPOCENE

This article has two broad concerns, both of which are pursued primarily with reference to Hegel's philosophy of history. First, it examines whether Hegel can help explain the difficulty we have in modernity in responding to climate change and ecological crisis. It argues that Hegel provides a useful analysis of this problem, since the model of self‐determination that he appeals to is comprehensively embedded in embodied forms of culture. This helps explain why even a self‐correcting worldview like modernity is obdurate in the face of this crisis. Second, Hegel claims that the defining attribute of spirit is its capacity for self‐production. Modernity is characterized by the emerging and widespread knowledge that spirit is self‐producing. Modernity develops institutions that facilitate and provide an objective reality for spirit's self‐production and its freedom. This aspect of the article examines whether the distinctive capacity of spirit for self‐determination, which is realized in modernity, is subject to the same atrophying conditions by which Hegel says all other historical shapes of spirit are characterized. It asks if the present ecological crisis, something that is directly attributable to spirit itself, represents the limits of self‐producing spirit. The article concludes by examining the difficult position of those countries that cannot be considered to be responsible for the emergence of the Anthropocene but whose actions in the present will amplify its impact.     

Migration Under Uncertainty: “Try Your Luck” or “Wait and See”

Two types of uncertainty enter into the migration decision. First, current conditions in the destination region may not be observable. Second, the future evolution of conditions in both the origin and destination regions may be unknown. The first type of uncertainty can encourage speculative or “try your luck” migration, whereas uncertainty about the future acts in the opposite direction, deterring relocation. This paper presents a dynamic optimizing model of migration that incorporates both types of uncertainty. The model shows that in equilibrium uncertainty about the future is likely to be more important than uncertainty about present conditions in the decision to relocate.     

TRANSPORT-RELATED FRINGE BENEFITS: IMPLICATIONS FOR MOVING AND THE JOURNEY TO WORK

ABSTRACT.  Firms offer compensation not only through wages, but also offer transport-related fringe benefits such as transport benefits (company cars, travel, and parking benefits) and relocation benefits to job applicants. We argue that these benefits are not randomly offered to employees, but depend on the job applicants' commuting costs. The firms' choice between these benefits affects the workers' incentive to move their residence closer to the workplace. Using information on firms' recruitment behavior in the United Kingdom, this paper shows empirically that the applicants' journey-to-work time induces firms to offer these benefits to job applicants. The implications of transport-related fringe benefits for commuting and relocation are found to be rather distinct. Transport benefits make employees less sensitive to the costs of commuting, whereas relocation benefits induce employees to move closer to the workplace.     

ECONOMIC FUNDAMENTALS AND URBAN–SUBURBAN DISPARITIES

ABSTRACT This paper develops a spatially explicit model to examine how urban and suburban communities evolve differently with changes in local economic fundamentals such as rising income or falling commuting costs in the metropolitan area. The model highlights the importance of environmental amenities and the economy of scale in the provision of public services as determinants of urban spatial structure. Results suggest that urban sprawl, income segregation, and jurisdictional disparities are driven by the same economic conditions and thus tend to co‐exist. Rising incomes or falling commuting costs for high‐income households in a metropolitan area tend to increase land prices and public services in every community, while rising incomes or falling commuting costs for low‐income households can have the opposite effects.     

Natural and Unnatural Disasters: Responding with Respect for Indigenous Rights and Knowledges

A key challenge for contemporary democratic societies is how to respond to disasters in ways that foster just and sustainable outcomes that build resilience, respect human rights, and foster economic, social, and cultural well‐being in reasonable timeframes and at reasonable costs. In many places experiencing rapid environmental change, indigenous people continue to exercise some level of self‐governance and autonomy, but they also face the burden of rapid social change and hostile or ambiguous policy settings. Drawing largely on experience in northern Australia, this paper argues that state policies can compound and contribute to vulnerability of indigenous groups to both natural and policy‐driven disasters in many places. State‐sponsored programmes that fail to respect indigenous rights and fail to acknowledge the relevance of indigenous knowledge to both social and environmental recovery entrench patterns of racialised disadvantage and marginalisation and set in train future vulnerabilities and disasters. The paper advocates an approach to risk assessment, preparation, and recovery that prioritises partnerships based on recognition, respect, and explicit commitment to justice. The alternatives are to continue prioritising short‐term expediencies and opportunistic pursuit of integration, or subverting indigenous rights and the knowledge systems that underpin them. This paper argues such alternatives are not only unethical, but also ineffective.     

Public Sector Relocation Policies in the UK and Ireland1

Public sector relocation from capital cities to reduce costs and ameliorate regional disparities has been a high profile but little researched government policy. The paper outlines the reasons for the growth of interest in public sector relocation in Europe, and then compares UK and Irish relocation policies. It argues there appears to be a good case for public sector relocation, but there is less agreement on the precise means whereby dispersal should be achieved. The paper highlights successful aspects of public sector relocation policies in the UK and Ireland and indicates areas for further research. Successful public sector dispersal depends on a willingness on the part of government to take a long-term view, and historical evidence suggests it is difficult to move senior posts from the capital.     

Migrant workers,self‐reliance,and the propensity to hold income protection insurance by country of residence

Utilising a large comparative survey across 11 countries, it is shown that country effects condition the individual uptake of income protection insurance and that shared attributes, including labour market status, are important factors in determining the take‐up of income protection insurance, whatever the respondents' country of residence. We observed differences in the respondents' coping strategies, including self‐reliance, and were able to distinguish between migrant workers and those who work in their country of origin, along with the “special” case of the Australian respondents. These findings have implications for the ongoing debate on the labour market effects of globalisation and the significance of national institutions and regulatory practices.     

In‐Situ Marginalisation: Social Impact of Chinese Mega‐Projects

This study offers a detailed analysis of an under‐researched social problem of in‐situ marginalisation and its causes by drawing on the concept of state entrepreneurialism. Our empirical data stem from the Lingang mega project in Shanghai and one of its neighbourhoods named Neighbourhood No.57 where we find that the residents have not been relocated but are instead suffering from declining public services and environmental quality from surrounding industrial developments. The root cause of this problem is the municipal government’s prioritisation of its strategic objectives of economic development over the livelihood of local residents. The strategic vision of the municipality has led to mass relocation in its early phases of development but in its later stages leaves many residents waiting for relocation whilst being gradually surrounded by industrial developments. Despite continued residential complaints and petitions, in‐situ marginalisation is not resolved due to the institutional arrangement of Lingang, which has centralised planning and financing powers to newly created project‐oriented state organisation. Social responsibilities have been relegated to lower‐tiered governments in Lingang which have neither planning power nor the financial resources to resolve the problems of residents. By examining the case of Lingang, this paper provides a different analytical framework for explaining the social problems emerging from China’s mega urban developments.     

Long wars and long telegrams: containing Al-Qaeda

Can history help the ‘war on terror’? It is a cliché that 9/11 changed the world. But the idea that the war is exceptional lacks historical perspective. Assuming a radically new threat, the Bush administration proclaimed a theology rather than a coherent strategy. It articulated the ‘war on terror’ as a utopian and unbounded quest for absolute security. It did not effectively measure costs against risks or orchestrate ends, ways and means. This led the United States into exhausting wars of attrition. A more careful dialogue with the past can address this. Containment, America's core idea during the Cold War, supplies a logic that can inform a prudent strategy. Like Soviet communism with its fatal self‐contradictions, Al‐Qaeda and its terror network is ultimately self‐destructive without major military operations. America and its allies can contain it with more limited measures in the long term as it destroys itself. The US should show restraint, doing nothing to hinder the growing Islamic revolt against Al‐Qaeda. In other words, fight small and wait.     

Assessing the Performance of Voluntary Environmental Programs: Does Certification Matter?

The promotion of voluntary environmental programs (VEPs) as alternative approaches to traditional environmental regulation has fueled numerous researchers to evaluate VEP performance. However, these studies have focused on assessing the environmental performance of a single VEP. As yet, we know little about the overall environmental benefits of these programs. Moreover, questions remain about whether VEPs designed with different monitoring regimes—related to whether programs are self‐monitored or undergo external certification—vary in their ability to improve environmental conditions. Using meta‐analysis methodology, this article evaluates the aggregated environmental outcomes of U.S. VEPs drawing on data from nine studies and over 30,000 firms. We show that collectively VEP participants do not improve their environmental performance over nonparticipants. Rather, nonparticipants improve their environmental performance by 7.7 percent more than VEP participants. Additionally, nonparticipants improve the environment 24 percent more than participants in self‐monitored VEPs, whereas participants in International Standards Organization 14001 as a group exhibit inconclusive environmental performance improvements.     

Model Uncertainty in Matrix Exponential Spatial Growth Regression Models

This article considers the most important aspects of model uncertainty for spatial regression models, namely, the appropriate spatial weight matrix to be employed and the appropriate explanatory variables. We focus on the spatial Durbin model (SDM) specification in this study that nests most models used in the regional growth literature, and develop a simple Bayesian model‐averaging approach that provides a unified and formal treatment of these aspects of model uncertainty for SDM growth models. The approach expands on previous work by reducing the computational costs through the use of Bayesian information criterion model weights and a matrix exponential specification of the SDM model. The spatial Durbin matrix exponential model has theoretical and computational advantages over the spatial autoregressive specification due to the ease of inversion, differentiation, and integration of the matrix exponential. In particular, the matrix exponential has a simple matrix determinant that vanishes for the case of a spatial weight matrix with a trace of zero. This allows for a larger domain of spatial growth regression models to be analyzed with this approach, including models based on different classes of spatial weight matrices. The working of the approach is illustrated for the case of 32 potential determinants and three classes of spatial weight matrices (contiguity‐based, k‐nearest neighbor, and distance‐based spatial weight matrices), using a data set of income per capita growth for 273 European regions.     

Can Affirmative Motivations Improve Compliance in Emissions Trading Programs?

Early emissions trading programs have obtained a very high rate of compliance, in part by using continuous emissions monitors (CEMs) that automatically record emissions data on a 24‐hour basis. As they expand into a wider range of pollutants and sources, however, such policies will have to rely on less automated forms of self‐reporting. This article asks if improved “affirmative motivations” for compliance based on perceptions of a policy's fairness could reduce the likelihood of underreporting, thereby lowering verification costs without unduly jeopardizing environmental integrity. Using a computerized laboratory emissions trading market, we find that many subjects reported emissions honestly in situations where dishonest reporting would have been more profitable, as well as a statistically significant association of affirmative motivations based on perceptions of a policy's fairness with honest reporting. These results suggest that designing an emissions trading program to increase its perceived fairness among users has the potential to increase honest emissions reporting and reduce monitoring costs.     

ON THE IMPACT OF COMPETITION ON TRADE AND FIRM LOCATION

We study how the level of trade costs and the intensity of competition interact to explain the nature and intensity of trade within a given industry and the location of firms across countries. As trade costs decrease from very high to very low values, the global economy moves from autarky to two‐way trade, through one‐way trade from the larger to the smaller region. By exploring the intensive and extensive margins of exports, we investigate how the intensity of trade reacts to the degree of competitiveness. Furthermore, when firms are free to change location, they flow from the small to the large country, and the larger country is always a net exported on the manufactured good. Firms located in the big country have a bigger size than those located in the small one. Under one‐way trade, the relocation of firms changes their attitude toward export.     

Interregional Wage Disparities, Relocation Costs, and Labor Mobility in Canada

This paper evaluates possible reasons why interregional wage differences might persist over long periods of time, such as a century or more. A general equilibrium model of interacting regions is developed which can consider explanations including interregional differences in production costs, changes in relocation (migration) costs, and differences in interregional transfer payments. Implications from the model are tested using panel microdata from the Canadian Labour Market Activity Surveys of 1989 and 1990. Key findings are that younger, better educated, native English-speaking workers, who presumably have better information and lower mobility costs, appear to have the smallest interregional wage differences. Thus, because the extent of spatial wage dispersion varies across workers with different characteristics, changes in the pattern of spatial wage disparities over time may be in part a demographic phenomenon.     

Market size,occupational self‐selection,sorting, and income inequality

We develop a monopolistic competition model with heterogeneous agents who self‐select into occupations (entrepreneurs and workers) depending on innate ability. The effect of market size on the equilibrium occupational structure crucially hinges on properties of the lower tier utility function—its scale elasticity and relative love‐for‐variety. When combined with the underlying ability distribution, the share of entrepreneurs and income inequality can increase or decrease with market size. When extended to allow for the endogenous sorting of mobile agents between cities, numerical examples suggest that sorting may increase inequality within and between cities.     

Loggers,Development Agents and the Exercise of Power in Amazonia

Many believe that Amazonian communities could benefit from the growing market for timber through self‐governed approaches to forest management. However, there is no clear understanding of how communities are to develop such approaches given logging frontiers that are characterized by informal negotiations with loggers and community forestry initiatives that are promoted by development agents. This article reports on research from four study areas in Bolivia, Brazil and Peru which reveals that external players exercise considerable power over communities. First, loggers and development agents impose forest management schemes directly on communities, hindering them from developing their own approaches. Second, paternalistic relationships with loggers and development agents prevent communities from identifying common interests and expressing these through their representative organizations. Finally, loggers and development agents use powerful discourses to shape acceptable schemes in forest management, silencing communities’ voices in debates. Through these different power mechanisms, external agents thwart the emergence of self‐governed community management approaches.     

Beyond ‘State Ibuism’: Empowerment Effects in State‐led Development in Indonesia

This article examines the ways women's processes of self‐formation are indicative (or not) of new possibilities for women's gendered selves in the post‐Reformasi period in Indonesia. It focuses on the development arena to reveal how shifts in state rhetoric, from top‐down guidance based on a patriarchal familial model to bottom‐up, inclusive development based on empowerment, have transformed what is referred to as the ‘topography for self’. The article draws upon theories of personhood a) to show how gendered selves emerge and are contested within particular historical conditions; and b) to develop an alternative framework of ‘empowerment’ that focuses not on capabilities and choice, but on an expansion in the possibilities for self. It argues that models of community‐driven development have provided new opportunities for women to hold and enact socially recognizable subject positions. This constitutes a form of empowerment for individual women but does not necessarily reflect challenges to patriarchy in Indonesia.     

Multiple Allocation Hub Location Model with Fixed Arc Costs

This article formulates a model to analyze the role of fixed costs in the design of optimal transportation hub networks. The primary purpose of this article is to better model costs in hub networks, an issue that has attracted considerable attention. This article allows particular versions of hub networks to emerge from the cost structure, rather than by imposing a rigid predefined connectivity protocol. The article integrates modeling approaches from an environmental hub location model with the three‐index formulation of Ernst and Krishnamoorthy to produce a hub location model with fixed and variable costs for all arcs. Our goal is to demonstrate how the inclusion of a richer cost model in transportation hub location can generate a wide range of different network types, depending on the relative magnitudes of the cost elements. While the existence of special case network solutions is well known and has been exploited in optimization, the current research provides added insight to the cost of flow in a more, or less, connected hub network. Eight fundamental prototype networks are derived as special cases, and some additional unanticipated network types also emerge. The results are illustrated with a standard CAB25 data set.