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Innovation and spatial inequality in Europe and USA

Lee, Neil and Rodríguez-Pose, Andrés (2013) Innovation and spatial inequality in Europe and USA. Journal of Economic Geography, 13 (1). pp. 1-22. ISSN 1468-2702

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Abstract

Innovation is a crucial driver of urban and regional economic success. Innovative cities and regions tend to grow faster and have higher average wages. Little research, however, has considered the potential negative consequences: as a small body of innovators gain relative to others, innovation may lead to inequality. The evidence on this point is fragmented, based on cross-sectional evidence on skill premia rather than overall levels of inequality. This article provides the first comparative evidence on the link between innovation and inequality in a continental perspective. Using micro data from population surveys for European regions and US cities, the article finds, after controlling for other potential factors, good evidence of a link between innovation and inequality in European regions, but only limited evidence of such a relationship in USA. Less-flexible labour markets and lower levels of migration seem to be at the root of the stronger association between innovation and income inequality in Europe than in USA.

Item Type: Article
Official URL: http://joeg.oxfordjournals.org/
Additional Information: © 2012 The Author(s)
Library of Congress subject classification: H Social Sciences > HN Social history and conditions. Social problems. Social reform
Journal of Economic Literature Classification System: D - Microeconomics > D3 - Distribution > D31 - Personal Income, Wealth, and Their Distributions
O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O31 - Innovation and Invention: Processes and Incentives
R - Urban, Rural, and Regional Economics > R1 - General Regional Economics > R13 - General Equilibrium and Welfare Economic Analysis of Regional Economies
Sets: Departments > European Institute
Departments > Geography and Environment
Research centres and groups > Spatial Economics Research Centre
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Funders: European Research Council under the European Union's Seventh Framework Programme (FP/2007-2013), Leverhulme Trust Major Research Fellowship
Projects: 269869
Date Deposited: 04 Feb 2013 14:34
URL: http://eprints.lse.ac.uk/48184/

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