Spatial econometrics is a branch of economics that looks at how location affects data analysis. Researchers study how spatial factors like proximity or differences between areas impact regression models. They explore different ways to include these effects in their models, like spatial lag and error models. By doing this, they can better understand how direct and indirect effects play out in different regions. They also examine how to account for variations in data across different locations. Overall, this research helps economists make more accurate predictions and draw better conclusions about how spatial factors influence economic outcomes.