The European Union - Regional Economics Applications Laboratory (EU-REAL) is a research net in regional science integrated by European people tied to the Regional Economics Applications Laboratory (REAL) in the University of Illinois at Urbana Champaign, USA. Like REAL, the EU-REAL focuses on the development and use of analytical models for urban and regional forecasting and economic development.

Next SEminar:

15th EU-REAL Workshop

(Palermo, Sicily, Italy, September 3-4, 2018)

Hosted by the Department of Culture and Society and the Department of Business Economics and Statistics at the University of Palermo

More information about the conference can be found in the conference webpage:

15th EU-REAL

Recent working papers:

Do crop insurance programs preclude their recipients from adapting to new climate conditions?

Zhangliang Chen and Sandy Dall’Erba

Abstract: Concerns that federal crop insurance programs reduce the farmers’ willingness to adapt to adverse changes in climate are growing. However, current evidence is limited to a small number of specific crops and relies on proxies for insurance payments. Here, we show how crop insurance programs modify the theoretical predictions of the Ricardian framework that accounts for all types of crops and many forms of adaptation to climate change. Furthermore, we exploit panel data on actual crop insurance payments to demonstrate empirically to what extent their magnitude and frequency bias the impact of climate change and extreme events on farmland value.


The Challenge of Estimating the Impact of Disasters: many approaches, many limitations and a compromise

Andre F. T. Avelino and Geoffrey J. D. Hewings

Abstract: The recent upward trend in the direct costs of natural disasters is a reflection of both an increase in asset densities and the concentration of economic activities in hazard-prone areas. Although losses in physical infrastructure and lifelines are usually spatially concentrated in a few areas, their effects tend to spread geographically and temporally due to production chains and the timing and length of disruptions. Since the 1980’s, several techniques have been proposed to model higher-order economic impacts of disruptive events, most of which are based on the input-output framework. However, there is still no consensus for a preferred model to adopt. Available models tend to focus on just one side of the market or have theoretical flaws when incorporating both sides. In this paper, the Generalized Dynamic Input-Output framework (GDIO) is presented and its theoretical basis derived. It encompasses the virtues of intertemporal dynamic models with the explicit intratemporal modeling of production and market clearing, thus allowing supply and demand constraints to be simultaneously analyzed. Final demand is endogenized via a demo-economic extension to study the impact of displacement and unemployment post-disaster. The key roles of inventories, expectation’s adjustment, primary inputs, labor force and physical assets in disaster assessment are explored and previous limitations in the literature are addressed. It will be shown that the dynamic Leontief model, the sequential interindustry model and the traditional input-output model are all special cases of the GDIO framework.