TESTING THE NEG MODEL: FURTHER EVIDENCE FROM PANEL DATA

Bernard Fingleton ()

Region et Developpement, 2009, vol. 30, 141-158

Abstract: Local wage variations in the UK are explained by two non-nested rival hypotheses. The first derives from new economic geography theory, in which wages depend on market access. The second come from urban economics theory, giving a reduced form with wage rates dependent on employment density. The paper examines whether one of these rivals is encompassed by the other by fitting an artificial nesting model using three alternative panel data estimators. The estimates indicate that neither hypothesis is encompassed by its rival, suggesting a need for new, more comprehensive, theory.

Keywords: PANEL DATA; SPATIALLY CORRELATED ERROR COMPONENTS; MARKET ACCESS; NEW ECONOMIC GEOGRAPHY; SPATIAL ECONOMETRICS; NON-NESTED HYPOTHESIS (search for similar items in EconPapers)
JEL-codes: C33 O18 R15 (search for similar items in EconPapers)
Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Testing the NEG Model: Further Evidence from Panel Data (2008)
Working Paper: Testing the NEG model: further evidence from panel data (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:tou:journl:v:30:y:2009:p:141-158

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