Analysis of Economic Growth in Regions: Geographical and Institutional Aspect

Publication date
Wednesday, 31.10.2007

О. Lugovoy, V. Dashkeyev, I. Mazayev, D. Fomchenko, Е. Polyakov, A. Hecht


This study explores disparity in regional development in Russia and in Canada and role of geography in their development. In the first chapter analysis of the role of geographic, economic, and institutional factors in economic growth over 1996–2004 is presented. Additionally the issue of the interregional spatial interaction is analyzed, which is studied in the framework of the new economic geography. The second chapter devoted to the development of Canadian provinces and analyzes factors of provincial differences along with factors of migration in Canada over the period of 1991–2001.

Chapter 1. Analysis of Economic Growth in Russian Regions: Geographical and Institutional Aspect   5
Introduction   5
Determinants of Economic Growth: Recent Research Trends    6
Specific Features of Cross-Regional Growth Studies   9
Geography and Economic Growth   10
New Economic Geography    11
Determinants of Economic Growth in Russian Regions: Empirical Analysis   13
Data and Methodology   14
Spatial Econometrics Methods    15
Application of Mundlak’s Specification to Simultaneous Equations Model of Regional Growth   17
Analysis of Spatial Autocorrelation of Economic Development    18
Description of the Main Hypotheses   23
Analysis of Convergence across Russian Regions with Respect to Spatial Dependence   29
Concepts and Models of Convergence   30
Results of the Empirical Analysis of Convergence   33
Sigma Convergence (1996–2004)    33
Beta Convergence (1998–2004)   39
Model of Economic Growth in Russian Regions   60
Output Growth Equation    61
Labor Factors Input   63
Capital Input Factors    65
Gross Regional Product per Capita    65
Estimation of the Model with 3SLS    68
Model of Regional Growth with Spatial Relations    75
Regional Growth Accounting   76
Scenario of Regional Economic Growth based on the SEM-Model    77
Major Implications for Regional Policy    78
Bibliography   82
Appendix 1: Spatial Econometrics   87
Weight Matrices    87
Spatial Correlation Statistics    90
Spatial Lag Model    92
Spatial Cross Regressive Model   93
Spatial Error Model    94
Appendix 2. Estimation results of Russian regions economic growth model    96
Appendix 3. Maps    102
Chapter 2. Canadian Regional Economic Well-being: a spatial analysis of their differences   103
Introduction   103
The Canadian Setting  105
Canadian Development and Regional Well being    109
Analysis of Population Changes in Canada at the Census Division Level    122
Bibliography   131

Analysis of Economic Growth in Regions: Geographical and Institutional Aspect / Consortium for Economic Policy Research and Advice; [Lugovoy O. et al.]. – Moscow : IET, 2007. – 132 p. 

ISBN 978-5-93255-236-0.

Agency CIP RSL
The research and the publication were undertaken in the frame-work of  CEPRA (Consortium for Economic Policy Research and Advice), project funded by the Canadian Agency for International Development (CIDA).

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