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## Über dieses Buch

This Festschrift is dedicated to ROLF FUNCK on occasion of his 60th birthday on February 7, 1990. It was a wholehearted desire of the authors who all are obliged to ROLF FUNCK in their research work to please and to honour him and to express their deep gratitude. I gladly took the initiative of preparing this Festschrift since I have been closely associated with ROLF FUNCK for many years of his academic life. We first met in 1958 when he was Assistant Professor (Wissenschaftlicher Assistent) and I was student at the University of Munster. A few years later, when ROLF FUNCK, still very young, moved to the University of Karlsruhe as Professor of Economics and Director of the Institute of Economic Policy and Research, he offered me the opportunity of working with him and this started a long period of successful scientific collaboration. Nowadays we meet only occasionally at conferences, in committees etc. , but I always recall with pleasure the warm-hearted and stimulating atmosphere he created at his In­ stitute in Karlsruhe. I express my thanks to the authors and to the publisher, the Springer Verlag, for their cooperation as well as to the sponsors who provided the necessary funds for the publication of this Festschrift. For her enthusiasm in compiling and processing the articles on the PC and producing the final draft I am indebted to Mrs. Ilona Lohr.

## Inhaltsverzeichnis

### Spatial Patterns of Resource Utilization

Abstract
Resources are either localized at isolated points or along one dimensional lines, or they are dispersed over two-dimensional areas. Which resources are utilized depends on accessibility and proximity to markets. Accessibility determines utilization costs, and distance from markets determines transportation costs. Sometimes either the resource itself or the product may be transported, and comparative transportation cost determines which is more economical. All this is well known to location theorists who have treated this problem under the heading of orientation (cf. LÖSCH, PALANDER, ISARD, BECKMANN).
Martin J. Beckmann

### Regional Output and Price Effects of Spatial Price Discrimination

Abstract
ROLF FUNCK’s interests in recent years (or should we say decades) have centered more and more on applied economics. These interests have extended from the taxing of motor traffic and the determining of how to make mass transit systems more efficient to forecasting and implementing regional economic growth. One might wonder how, given his practicality, the authors of this paper decided to avoid such subjects as urban transit, regional development, benefit-cost analysis and instead to focus on what can easily be referred to as being the opposite side of that coin: namely the theory of regional outputs and prices. We have two answers for our deviations: (i) Professor FUNCK has also worked often with the other side of the coin1, and (ii) our own interests have run the gamut from the one side to the other with our recent focus having centered on the hope that spatial microeconomic theory per se will take a giant leap forward during the 1990’s. We trust that this paper will not only reflect recent advances but promote interest in a side of spatial microeconomics that must be moved forward rapidly in the immediate future. If such movement can (and does) take place in the years to come, applications of theory will, in turn, be more penetrating and important than in the past.
John Greenhut, Melvin L. Greenhut, Hiroshi Ohta

### Transport Flows in Tinbergen-Bos Systems

Abstract
Work on Tinbergen-Bos systems has proven to be fruitful in discovering spatial properties concerning the organisation of activity.1 In the paper just referred to a research programme is suggested, in which a portion is devoted to the study of metrics and transport flows in TBS. Some of these threads have already been taken up2; this paper however is a more fundamental approach. It makes explicit and justifies some hypotheses under which, it is hoped, more progress can be made in this field of research.
J. Hans Kuiper, Jean H. P. Paelinck, Kenneth E. Rosing

### Economics of Multi-Habitation

Abstract
In the Fourth Nation-wide Comprehensive Regional Development Plan worked out by the Japanese government in 1987, there were a concept and policy recommendation of “multi-habitation”.1 People were encouraged to possess the second residence apart from their original residence partly because it may activate local areas which were losing their population as a consequence of reconcentration of population and economic activities to the Tokyo Metropolitan Area in 1980s. The aim of the present paper is to explore rationale of this multi-habitation policy from the viewpoint of regional economic theory.
Noboru Sakashita

### Operationalizing the Trade Variable in a Funck-type Multi-Region Global Model

Abstract
My association with ROLF FUNCK goes back many years. Our first real interaction took place at the Summer Institute in Regional Science, the University of California (Berkeley), 1962. There, and ever since, I have been much influenced by his emphasis on regional policy development within a conceptual framework of a comprehensive multi-regional (interregional) system. Perhaps the one contribution of his which has most influenced my work was his paper “A Policy-Oriented Model of Regional Economic Growth” and the associated materials he presented at the Advanced Studies Institute on Recent Developments in Regional Science which he organized at Karlsruhe. As most of us know, the Institute was exceedingly fruitful and led to the inauguration of the subsequent set of stimulating European Summer Institutes of the Regional Science Association.
Walter Isard

### The Importance of Infrastructure in Regional Evolution

Abstract
In more than twenty years my friendship with ROLF FUNCK has long grown to become more than a professional relationship. In many discussions, some joint research projects and minor consulting contracts for policy-makers “the importance of infrastructure in regional development” time and again caused us distress. And at times, after having gained this insight or the other, it even instilled us with feeling of pleasure.
Dieter Bökemann

### Barriers to Technological Transfer: Infrastructural Difficulties in Nigeria

Abstract
Dear ROLF: In your first major work, Verkehr und volkswirtschaftliche Gesamtrechnung of 1961, dealing with the transportation component of the material infrastructure, you declared clearly and precisely your commitment to economic theory as an indispensable part of economic inquiry or what Joseph A. SCHUMPETER called “scientific economic analysis”. In that volume, you were a veritable captive of LEONTIEF’s Input-Output analysis. [I-A]-1∙Y=X seemed like a lodestar to your future as a German academic economist.
Nicholas W. Balabkins

### Telecommunications Infrastructure and Regional Development

Abstract
The relationship between infrastructure and regional development is one of the most intriguing problems in regional policy for less prosperous areas. Since World War II the extensive literature on economic growth and development has emphasized the key role of “infrastructure” or “economic and social overhead capital” in national and regional development. There has been much discussion on the crucial role of infrastructure and the temporal order in which infrastructure and other forms of capital should be provided so as to stimulate economic development in less developed countries as well as in lagging regions of industrialized societies. The level and quality of services flowing from existing infrastructure is often low, in many cases falling below ‘threshold’ levels, so that their effects on economic output are negligible.
Maria Giaoutzi

### Health Care Modeling A Potential Research Area in Regional Science

Abstract
In 1987 the total health care cost for the United States was $500 billion. As compared to$94 billion in 1972, this growth rate is substantially higher than the general economic growth during the same period, and consistently higher than the general inflation rate of the country. Researchers estimate that by the year 1990, total health care costs in the U.S. will equal $700 billion, out of which governmental spending will be about$500 billion. Due mainly to medicare and medicaid, the federal government’s share will be about 75%. Changes have occurred in the pattern of health care expenditures during the last two decades. With an average rate of \$13% per year increase, recently hospital costs have risen to 45% of the total health care cost, compared to 39.9% in 1966. Nursing home costs have increased from 3% during the same period to about 10%. This increase in hospital and nursing home care has been offset by a slight decrease in the cost of physicians’ services, dental care, and cost of medicine.
Manas Chatterji

### Pareto-Efficient Relation Between Infrastructure and Industry

Abstract
We assume the hypothesis that the relation between infrastructure and industry exerts significant influence on the efficiency of urban and regional economy. There exist statistical evidences which allow for the acceptance of this hypothesis with high degree of confidence. Hence, it is purposeful to search methods enabling efficient shaping of this relation.
Ryszard Domanski

### Estimation Procedures for Transportation Network Equilibrium Models

Abstract
This paper examines the estimation of parameter values for a class of urban location and travel choice models in which the travel costs are endogenously determined. These models are variously known as combined trip distribution and assignment models (EVANS, 1976), network equilibrium models of urban location and travel choice (BOYCE et al., 1988), or models of congested spatial interaction behavior (SMITH, 1983). A synthesis and discussion of the results of research performed from 1976 to date by the first author and his students is given in BOYCE (1990). The spatial interaction, or trip distribution, model embedded in these models can take the form of the generalized gravity model, a major research interest of the second author (SEN and SOOT, 1981; SEN, 1986).
David Boyce, Ashish Sen

### Airline Network Structure and Regional Economic Development: US Case Studies

Abstract
Professor FUNCK has had a long interest in the role of infrastructure in shaping the path of development for regions at different spatial scales. In this paper, we provide some empirical evaluation of the effects of a major change in the regulation of a transportation industry on the supporting spatial infrastructure in the United States. Contrary to many popular statements, the processes of change were evident before deregulation; while the deregulated system has moved at a more rapid pace, the network structure was evolving over the last several decades.
Aisling J. Reynolds, Geoffry J. D. Hewings

### Employment Impacts of Infrastructure Investments

A Case Study for the Netherlands
Abstract
The interest in infrastructure — from both a scientific and a political angle — is exhibiting a wave-like pattern. In the period of the sixties a broad interest in infrastructure expansion emerged as a result of the unprecedented economic growth necessitating the construction of large infrastructure networks. In the seventies much more emphasis was placed on a more efficient use of existing network capacity, mainly as a result of the limits to growth discussion (including environmental externalities and resource scarcity). In the eighties the attention shifted towards infrastructure and economic stagnation, as a result of a particular interest in the relationship between public investment and employment, whilst in the second part of the eighties also the restructuring effects of new infrastructure (e.g., informatics, telematics) came to the fore (see e.g. GIAOUTZI and NIJKAMP, 1988). Very recently also the relationship between infrastructure and international trade (and competition) — from the viewpoint of the unification of the European market — has been given due attention (including the interest in high speed transport systems).
Frank Bruinsma, Peter Nijkamp, Piet Rietveld

### Deregulation and the Problem of Capacity/Price Planning for the Transport and Communication Infrastructure

Abstract
Transport and communication are sectors in which the efficiency of the price mechanism is traditionally questioned and government regulation is assumed to be necessary in addition to the normal rules of competition. In all countries roads and waterways are very largely publicly owned. Railways mostly belong to government-controlled companies, and the same holds for the telecom sector.
Werner Rothengatter

### Meso-Economics and Organizational Ecology

Abstract
Meso-economics can be defined as the intermediary level between macro-economics and micro-economics. The field of mesoeconomics is subdivided into the study of regional economics and that of sectoral developments or the industrial organization. Naturally, this latter subdiscipline is basic to understanding regional economic developments. In many cases the reverse relation is also true (MASSEY, 1984; Van DUIJN and LAMBOOY, 1982). Anyway, regional economics has to reckon especially with two aspects of sectoral developments: (i) the dynamics and the structure of the market; and (ii) the ecology of organisations, or the relational structure with the socioeconomic environment. The first aspect is connected with the dynamic nature of competition in spatially and technologically developing markets; the second one concerns the spatial nature of relations between firms, more specifically the network structure.
Jan G. Lambooy

### On Concepts of Regional Economic Structure

Abstract
The world of economics is apparently one of endless diversity, both in the nature of economic activity and in the economic structure of those myriads of entities which we call “economies.” The economic literature implies that this diversity is sufficiently extensive to be a dominant feature of economies, or at least intractable to successful economic analysis. Amidst this diversity, economists have been able to identify commonalities or regularities in economic structure only in the most general and non-operational terms, and have made virtually no progress towards either classifying economies into “like”, “similar” or “dissimilar” groups, of identifying a basis for measures of similarity among economies.
Rodney C. Jensen, Guy R. West, John H. L. Dewhurst

### How Different Are Regions? An Evolutionary Approach to Regional Inequality

Abstract
What is a region and how and why does it differ from others is one of the fundamental questions of most people related to regional science. At several occasions ROLF FUNCK (e.g. 1976, 1978, 1986) has emphasized that the definition of a region must meet a number of criteria the economic ones being only a part of them. But he also pointed to the fact that there are different ways of approaching these economic criteria (e.g. in interpreting the merits of A. LÖSCH in respect to this question): “Static equilibrium is the standard of reference ..., but there is plenty of room for dynamic, disequilibrium interpretation of reality.” (FUNCK and KOWALSKI, 1986, p. 3).
Michael Steiner

### How not to Lie with Statistics in Regional Analysis

Abstract
Let Pi=xi|yi be the ratio of two economic indicators observed in a region i of a country that is divided into n regions (i=1,...,n). In what follows, we think of pi as the productivity of labour in region i, that is, x1 is the value added and y1 the labour applied in region i.
Wolfgang Eichhorn

### A New Approach in Decision Theory

Abstract
Classical decision models select optimal solutions among alternativ options which are realizable under the prevailing conditions. The selection process itself is based upon preference scalings given by utility functions incorporating the norms and the value judgements with regard to public and individual objectives. In this way a classical decision-making model is based upon the seperation of constraints and utilities (BÖTTCHER and SIEMONS, 1989).
Harry Böttcher, Johannes Siemons

### The Silver Sheen on the Netherlands A New Perspective for Regional Policy

Abstract
Dutch economic science seems suddenly to have rediscovered how essential demography is to the economic development in our country and the western countries in general. The renewed interest is expressed among other things in publications, congresses and discussions concerning the significance of an aging population and its gloomy consequences for the active population, likely to go on diminishing steadily in future. For, as is pointed out, the latter group finds itself confronted with a steadily expanding group of senior citizens or senior non-workers, who tend to live longer than in the past, thus spelling serious trouble to the younger generations. Such worried statements are seldom heard from people who know how an economy functions, how for instance the system of saving up for pensions fits into it, and why at the time a system of apportionment for old-age pensions was preferred to one of capital reserve; probably that is precisely why they are heard so frequently.
Leo H. Klaassen, Jacob A. van der Vlist

### New Jobs in Connection with Technology Centres and Research Parks

A Case Study from Baden-Württemberg/West Germany
Abstract
The federal state of Baden-Württemberg was formed as late as 1952 when the states of Baden, Württemberg-Baden and Württemberg-Hohenzollern were united. It is thus a rather young state.
Jürgen Morlok

### Poland — the Challenging Laboratory of Space Economy

Abstract
The summer 1989 is a unique experience in Polish and maybe not only Polish history. With some exaggeration we can speak about the Second Miracle on the Vistula.1 Anyway this is a summer of qualitative change of the Polish political system — the end of the III. Republic and the birth of the IV. Republic. The situation is very complicated, dangerous and full of hope.
Antoni Kukliński

### Economic Reforms in Centrally Planned Economies and their Consequences for Regional Development

Abstract
One important issue which has been largely ignored in the literature on regional development and policy in Centrally Planned Economies (CPEs) concerns the possible impacts, if any, of the attempted economic reforms of the CPEs on future regional development in these countries (one notable exception from this neglect is GORZELAK, 1989).
Jan S. Kowalski

### A Theory Explaining Lösch-Cycles

Abstract
ROLF FUNCK was always very clear when he was talking about AUGUST LÖSCH. He considered him as one of the most important German economists who was not only pioneer in the field of regional science but who made also important contributions in several other areas of economics. With the book “Bevölkerungswellen und Wechsellagen” (LÖSCH, 1936) he presented pathbreaking research in demographical economics. As the book was never translated into English the knowledge of his empirical research and the theoretical explanations for his findings on the relation of population changes and business-cycles remained restricted to German students.
Bernhard Felderer

### August Lösch as a Population Analyst

Abstract
Regional science and, particularly, location theory has been heavily influenced by AUGUST LÖSCH, and his name has become well known to all students dealing with regional analysis and theory. They are also well aware in general of his studies on interactions between population development and economic cycles, but may be less interested in this topic. The interests in space and in time must not coincide in every scholar. At least, while the literature on LÖSCH’s theorems in regional economics is abundant, and quotations on them can be met almost everywhere in regional science contexts, the reaction on LÖSCH’s writings by population analysts must be regarded less than meagre. MACKENROTH (1953, 506) mentions LÖSCH only twice (109, 123), and only as a source for factual information (as in III, 1955, once, and only in the bibliography, concerning “special peaces of research, of particular importance”: p.36); and neither W.G. HOFFMANN — who knew him like MACKENROTH from the Kiel Institute — nor HOHORST mention him at all, even while pursuing topics which LÖSCH must have, more or less, introduced.
Rainer Mackensen

### Development of Economy and Traffic

Abstract
Traffic is defined as a change of place of persons and goods. The nature and the volume of freight transport are directly influenced by the nature and the volume of the production of these goods. Passenger traffic as a realisation of potential wishes of mobility certainly depends on the supply of means of transport and, among other factors, on the standard of living. Thus, there is a connection between the development of economy and that of traffic. The analysis of some selected examples will show, if and how such connections can be illustrated.
Wilhelm Leutzbach

### Are Car Purchases Savings? An Analysis of German Households

Abstract
Savings, defined as increase in net wealth, are characterized in most studies as a portfolio of different financial assets or long term durable goods such as houses. Cars are normally not included, although they have typical properties of assets; for instance, they yield returns, change in value or are subject to risk just like bonds or shares. Germans, in particular, clearly take into account the resale values of cars when they make a car purchase, a ‘stylized fact’ that points to the usefulness of an analytical inquiry of this question: we want to explicitly test the hypothesis that car purchase expenditures are considered by households as part of their long-term investments, using German household data for 1983. Naturally, a savings function based on this extended definition should not look very different from a “classical” savings function.
Ulrich C. H. Blum, Marc J. I. Gaudry

### Backmatter

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