Is inequality good for innovation?
Is inequality good for innovation?
Is inequality good for innovation? This article addresses this question, using aggregated microeconomic data for 102 regions over the period 1995—2000 from the European Community Household Panel (ECHP) data set, complemented with Eurostat’s Regio data. Static and dynamic panel data specifications and Granger causality tests for panel data are used to assess the relationship between patents, included as a proxy for innovation and income inequality. The results indicate that, given existing levels of income inequality in European Union (EU), an increase in a region’s inequality favors innovation. In addition, geographic space is a key factor in explaining the heterogeneous association between innovation and inequality, and innovation is characterized by circular, cumulative, and intraregional spillover effects. The above findings are robust to changes in the definition of income distribution and across inequality measurements.
income inequality, innovation, patents, granger causality, regions, Europe
75-101
Tselios, Vassilis
a1fc70a6-a193-4075-8e36-5b07b65ebd17
January 2011
Tselios, Vassilis
a1fc70a6-a193-4075-8e36-5b07b65ebd17
Tselios, Vassilis
(2011)
Is inequality good for innovation?
International Regional Science Review, 34 (1), .
(doi:10.1177/0160017610383278).
Abstract
Is inequality good for innovation? This article addresses this question, using aggregated microeconomic data for 102 regions over the period 1995—2000 from the European Community Household Panel (ECHP) data set, complemented with Eurostat’s Regio data. Static and dynamic panel data specifications and Granger causality tests for panel data are used to assess the relationship between patents, included as a proxy for innovation and income inequality. The results indicate that, given existing levels of income inequality in European Union (EU), an increase in a region’s inequality favors innovation. In addition, geographic space is a key factor in explaining the heterogeneous association between innovation and inequality, and innovation is characterized by circular, cumulative, and intraregional spillover effects. The above findings are robust to changes in the definition of income distribution and across inequality measurements.
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e-pub ahead of print date: 22 November 2010
Published date: January 2011
Keywords:
income inequality, innovation, patents, granger causality, regions, Europe
Organisations:
Economy, Society and Space
Identifiers
Local EPrints ID: 340920
URI: http://eprints.soton.ac.uk/id/eprint/340920
ISSN: 0160-0176
PURE UUID: 2f0e4dfd-15fe-4ad4-a328-91dbcbffbd35
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Date deposited: 06 Jul 2012 13:19
Last modified: 14 Mar 2024 11:31
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Author:
Vassilis Tselios
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