Relatedness in regional development: in search of the right specification

Yang Li and Frank Neffke

No 2208, Papers in Evolutionary Economic Geography (PEEG) from Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography

Abstract: A large body of research has documented that the size and growth of an industry in a city or region depends on the local size of related industries. However, there is no consensus on how to best measure, either the relatedness between industries, or how well a particular industry fits a local economy as a whole. In this paper, we perform a structured search over tens of thousands of specifications to identify optimal – in terms of out-of-sample predictions – ways to construct these quantities, using a dataset that allows us to derive relatedness from co-occurrence patterns of industries in establishments, firms, regions and countries. We find that these di

Date: 2022-04, Revised 2022-04
New Economics Papers: this item is included in nep-bec, nep-geo, nep-ino, nep-sbm, nep-tid and nep-ure
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http://econ.geo.uu.nl/peeg/peeg2208.pdf Version May 2022 (application/pdf)

Related works:
Working Paper: Evaluating the Principle of Relatedness: Estimation, Drivers and Implications for Policy (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:egu:wpaper:2208

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