THE BUILD-UP AND DURATION OF SUBSIDY-INDUCED EMPLOYMENT EVIDENCE FROM U.K. REGIONAL POLICY*

ABSTRACT. The paper takes microlevel data on U.K. regional policy instruments and other financial assistance payments to industry to examine the time profile of assisted employment up to five years after the date of assistance. The theoretical analysis indicates factors bearing on the employment effect of industrial assistance and highlights the possibly key role played by the firm's access to private funds. The results from the regression analysis indicate that both the build-up and duration of subsidy-induced jobs vary between assistance form and firm, and that assistance is generally ineffective in large firms. Elsewhere, assisted jobs accumulate over a period of three years, but then are lost to policy at high rates.     

THE INTRAMETROPOLITAN DISTRIBUTION OF R&D ACTIVITIES: THEORY AND EMPIRICAL EVIDENCE*

ABSTRACT. The paper presents a first attempt to unveil the underlying determinants of the geography of R&D labs within contemporary metropolises. To this end, the study builds on the premise of contemporary intraurban location and pricing models, suggesting that intraurban variations in property rents must reflect the imputed location preferences of firms or their workforce, as well as the extent to which local institutional constraints hinder these preferences. Against this background, the study proceeds with the econometric analysis of R&D property rent differentials within Greater Los Angeles. The empirical results indicate that access to research and nonresearch universities, transportation access, access to a host of worker amenities, as well as zoning and other local regulations play a critical role in shaping the intraurban geography of R&D labs.     

THE DETERMINANTS OF 1963–77 REGIONAL MANUFACTURING GROWTH: WHY THE SOUTH AND WEST GROW*

ABSTRACT. This paper analyzes 1963–77 manufacturing employment growth in the 48 contiguous states. Six factors jointly explain 96 percent of the variance. Markets explains 55 percent; climate, 15 percent; a rural state attraction, 11 percent; unionization, 6 percent; thresholds, 5 percent; and amenities, 4 percent. Resources, taxes, and business climate lack significance. Sunbelt-Frostbelt is a false dichotomy: the Northwest grew as fast as the South. The real contrast–largely caused by markets–is between growth rates of 6 percent in the Manufacturing Belt, 35 percent in its bordering Transition Zone, and 58 percent in the combined South and West.     

EFFICIENTLY MANAGING SPATIALLY COMPETING WATER USES: NEW EVIDENCE FROM A REGIONAL RECREATION DEMAND MODEL*

ABSTRACT In arid regions, managing water efficiently among competing demands depends critically on measuring comparable economic values of each end use. Unfortunately, it has been difficult to measure recreational values of water in the arid western U.S. These difficulties result from open spaces, few sites, and low incomes typical of the region. We examine whether water used for recreation can economically compete with agriculture. We accomplish this objective by extending the travel cost model to account for conditions unique to arid environments. We use demand systems theory to estimate a regional travel cost model which accounts for travel time, substitute sites, and discretionary travel cost. Findings from New Mexico's Pecos River Basin reveal recreational values of water which are 4040 percent higher than would result from conventional travel cost methodology. Measured recreation values of $130 per acre-foot compare with equivalent values of water in irrigated agriculture of $25–$40 per acre-foot.     

PUBLIC CAPITAL, REGIONAL OUTPUT, AND DEVELOPMENT: SOME EMPIRICAL EVIDENCE

ABSTRACT The goal of our paper is to provide direct estimates of the association between public capital and regional output. This is made possible by the construction of a data series which measures public capital at the state level.
The relation between public capital and other productive factors is tested using a translog production function. Our results show that labor and public capital are complementary inputs, and that public capital exhibited diminishing returns. We also consider restrictions on the translog formulation. Linear homogeneity is rejected in all cases, and the Cobb-Douglas specification is rejected for the manufacturing and all sectors categories.