Identification of Spatial Spillovers: Do's and Don'ts

C-Tier
Journal: Journal of Economic Surveys
Year: 2025
Volume: 39
Issue: 5
Pages: 2152-2173

Authors (2)

Score contribution per author:

0.503 = (α=2.01 / 2 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

The notion of spatial spillovers has been widely used in applied spatial econometrics. In this paper, we consider how they can be identified in both structural and causal reduced‐form models. First, discussing the various threats to identification in structural models, we point out that the typical estimation framework proposed in the applied spatial econometric literature boils down to considering spatial spillovers as a side‐effect of a data‐driven chosen specification. We also discuss the limits of blindly relying on interaction matrices purely based on geography to identify the source and content of spillovers. Then, we present reduced forms impact evaluation models for spatial data and show that the current spatial versions of usual impact evaluation models are not fully satisfactory when considering the identification issue. Finally, we propose a set of recommendations for applied articles aimed at identifying spatial spillovers.

Technical Details

RePEc Handle
repec:bla:jecsur:v:39:y:2025:i:5:p:2152-2173
Journal Field
General
Author Count
2
Added to Database
2026-01-25