{"status":"ok","message-type":"work","message-version":"1.0.0","message":{"indexed":{"date-parts":[[2026,10,1]],"date-time":"2026-10-01T22:54:19Z","timestamp":1790895259530,"version":"4.1.0"},"reference-count":54,"publisher":"The Econometric Society","issue":"5","funder":[{"DOI":"10.13039\/100000001","name":"National Science Foundation","doi-asserted-by":"publisher","id":[{"id":"10.13039\/100000001","id-type":"DOI","asserted-by":"publisher"}]}],"content-domain":{"domain":[],"crossmark-restriction":false},"short-container-title":["ECTA"],"abstract":"<jats:p>This paper proposes a model for, and investigates the consequences of, strong spatial dependence in economic variables. Our findings echo those of the corresponding \u201cunit root\u201d time series literature: Spatial unit root processes induce spuriously significant regression results, even with clustered standard errors or spatial HAC corrections. We develop large\u2010sample valid unit root and stationarity tests that can detect such strong spatial dependence. Finally, we use simulations to study strategies for valid inference in regressions with persistent spatial data, such as spatial analogues of first\u2010differencing transformations. Regressions from Chetty, Hendren, Kline, and Saez (2014) are used to illustrate the issues and methods.<\/jats:p>","DOI":"10.3982\/ecta21654","type":"journal-article","created":{"date-parts":[[2024,9,20]],"date-time":"2024-09-20T07:17:38Z","timestamp":1726816658000},"page":"1661-1695","source":"Crossref","is-referenced-by-count":33,"title":["Spatial Unit Roots and Spurious Regression"],"prefix":"10.3982","volume":"92","author":[{"given":"Ulrich K.","family":"M\u00fcller","sequence":"first","affiliation":[{"name":"Department of Economics, Princeton University"}],"role":[{"vocabulary":"crossref","role":"author"}]},{"given":"Mark W.","family":"Watson","sequence":"additional","affiliation":[{"name":"Department of Economics, Princeton University"}],"role":[{"vocabulary":"crossref","role":"author"}]}],"member":"2359","published-online":{"date-parts":[[2024]]},"reference":[{"key":"ecta200718-bib-0001","series-title":"Classics in Applied 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