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Scale Economies and Industry Agglomeration Externalities: A Dynamic Cost Function Approach Author info | Abstract | Publisher info | Download info | Related research | Statistics Catherine J. Morrison Paul
Donald S. Siegel
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Scale economies and agglomeration externalities are alleged to be important determinants of economic growth. To assess these effects, the authors outline and estimate a microfoundations model based on a dynamic cost function specification. This model provides for the separate identification of the impacts of externalities and cyclical utilization on short- and long-run scale economies and input substitution patterns. The authors find that scale economies are prevalent in U.S manufacturing; cost savings and scale effects often attributed to internal inputs may be due to external factors; and supply-side agglomeration effects are greater than demand-side, especially in the long run.
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Article provided by American Economic Association in its journal American Economic Review .
Volume (Year): 89 (1999)
Issue (Month): 1 (March)
Pages: 272-290
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Handle: RePEc:aea:aecrev:v:89:y:1999:i:1:p:272-290Contact details of provider: Email: Web page: http://www.aeaweb.org/aer/ More information through EDIRC
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