Table of Contents

Handbook of Research Methods and Applications in Economic Geography

Handbook of Research Methods and Applications in Economic Geography

Handbooks of Research Methods and Applications series

Edited by Charlie Karlsson, Martin Andersson and Therese Norman

The main purpose of this Handbook is to provide overviews and assessments of the state-of-the-art regarding research methods, approaches and applications central to economic geography. The chapters are written by distinguished researchers from a variety of scholarly traditions and with a background in different academic disciplines including economics, economic, human and cultural geography, and economic history. The resulting handbook covers a broad spectrum of methodologies and approaches applicable in analyses pertaining to the geography of economic activities and economic outcomes.

Chapter 21: The impact of private, public and human capital on the US states’ economies: theory, extensions and evidence

Sandy Dall’erba and Irving Llamosas-Rosas

Subjects: economics and finance, regional economics, geography, economic geography, research methods in geography, research methods, research methods in economics, research methods in geography, urban and regional studies, regional economics, research methods in urban and regional studies


The last decade has seen an upsurge of estimations of regional production functions stimulated by the desire to identify the factors at the origin of economic growth in general and the role of public investments in particular. A large amount of empirical work focusing on these issues relies on a Cobb–Douglas production framework to estimate the impact of labor, physical and human capital on output level and output growth. The extensive use of Cobb–Douglas production functions started in the growth accounting literature (Solow, 1956) as a framework to explain wide differences in economic performances across countries. Despite its age and the criticisms related to aggregating firm-level Cobb–Douglas production functions to the regional or national level (see, e.g., Felipe and McCombie, 2012), it is still one of the most popular ways to estimate factor productivity and technological progress, the so-called Solow residual. An extension of the growth accounting framework is the level accounting decomposition, whose goal is to estimate factor productivity and efficiency levels instead of growth rates and technological changes (Hall and Jones, 1999). The parametric equivalent of the growth accounting methods is the growth regression literature (Islam, 1995; Barro and Sala-i-Martin, 1991, 2004), where technological progress is estimated as opposed to being treated as a residual from a calibration exercise, as in the former literature. A recent development based on this approach would be the non-stationary panel methodologies that assume cross-section dependence (Marrocu et al., 2000; Costantini and Destefanis, 2009).

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