Assessing geographical effects in spatial diffusion processes: The case of euro coins

We examine how geographical structures impact diffusion processes within a regional system. From the example of euro coin diffusion across countries, we show how the relative position and population endowment of regions impact our understanding of interregional mobility, beyond simple spatial interaction effects. The mix of coins of different origins is a complex but unique trace of the movement of individuals within a common currency area, potentially revealing a new facet of European integration. We simulate an individual-based dynamic model where agents move and exchange coins across regions. We analyse the convergence towards a homogeneous mix of coins through time for a series of different theoretical spatial systems. This sensitivity analysis demonstrates the impact of the regularity and aggregation levels, or centrality/periphery effects, on spatial diffusion dynamics. We then calibrate the model against empirical data for the regions of 5 European countries and provide estimates of mobility rates, distance decay and population attractiveness factors, affecting the diffusion of coins, hence international movements and European integration.