Palgrave Handbook of Econometrics: Applied Econometrics

(Grace) #1

1276 Spatial Analysis of Economic Convergence


LISA Markov transitions there is evidence of spatial polarization in the transitions,
as the “extreme” classes are the HH and LL cells, which have higher retention
probabilities than is the case for the HL and LH cells.


27.3.2.2 Space-time paths


In addition to characterizing the global spatial dynamics, a more meso-level scale
of analysis is possible. Figure 27.5 contains thespace-timepaths for Virginia (left)
and New Jersey (right). The paths are generated interactively by selecting the states
in the Moran scatterplot (lower left) and clicking. The time paths trace out the
local statistic for each state, showing how its income and that of its neighbors co-
evolve over the sample period. At first glance, a comparative view of the two states
suggests that the same general trend is evident, reflecting strong spatial cohesion
between each state and its neighbors. Closer inspection reveals, however, that


Figure 27.5 Space-time paths

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