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Do local energy prices and regulation affect the geographic concentration of employment?

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Author Info

  • Kahn, Matthew E.
  • Mansur, Erin T.

Abstract

Manufacturing industries differ with respect to their energy intensity, labor-to-capital ratio and their pollution intensity. Across the United States, there is significant variation in electricity prices and labor and environmental regulation. This paper examines whether the basic logic of comparative advantage can explain the geographical clustering of U.S. manufacturing. We document that energy-intensive industries concentrate in low electricity price counties and labor-intensive industries avoid pro-union counties. We find mixed evidence that pollution-intensive industries locate in counties featuring relatively lax Clean Air Act regulation.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Public Economics.

Volume (Year): 101 (2013)
Issue (Month): C ()
Pages: 105-114

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Handle: RePEc:eee:pubeco:v:101:y:2013:i:c:p:105-114

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Web page: http://www.elsevier.com/locate/inca/505578

Related research

Keywords: Manufacturing employment; Electricity prices; Regulation;

References

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  1. Glenn Ellison & Edward L. Glaeser, 1999. "The Geographic Concentration of Industry: Does Natural Advantage Explain Agglomeration?," Harvard Institute of Economic Research Working Papers 1862, Harvard - Institute of Economic Research.
  2. Joskow, P.L., 1989. "Regulatory Failure, Regulatory Reform And Structural Change In The Electric Power Industry," Working papers 516, Massachusetts Institute of Technology (MIT), Department of Economics.
  3. Andrew B. Bernard & J. Bradford Jensen & Peter K. Schott, 2003. "Survival of the best fit: exposure to low-wage countries and the (uneven) growth of U.S. manufacturing plants," LSE Research Online Documents on Economics 20028, London School of Economics and Political Science, LSE Library.
  4. Robert S. Chirinko & Daniel J. Wilson, 2007. "State Investment Tax Incentives: A Zero-Sum Game?," CESifo Working Paper Series 1895, CESifo Group Munich.
  5. Eli Berman & Linda T. Bui, 1997. "Environmental Regulation and Labor Demand: Evidence from the South Coast Air Basin," Papers 0082, Boston University - Industry Studies Programme.
  6. Kahn, Matthew E., 1997. "Particulate pollution trends in the United States," Regional Science and Urban Economics, Elsevier, vol. 27(1), pages 87-107, February.
  7. Steven J. Davis & Cheryl Grim & John Haltiwanger & Mary Streitwieser, 2008. "Electricity Pricing to U.S. Manufacturing Plants, 1963-2000," NBER Working Papers 13778, National Bureau of Economic Research, Inc.
  8. Steven J. Davis & R. Jason Faberman & John Haltiwanger, 2006. "The Flow Approach to Labor Markets: New Data Sources and Micro-Macro Links," NBER Working Papers 12167, National Bureau of Economic Research, Inc.
  9. Carlton, Dennis W, 1983. "The Location and Employment Choices of New Firms: An Econometric Model with Discrete and Continuous Endogenous Variables," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 440-49, August.
  10. Arindrajit Dube & T. William Lester & Michael Reich, 2010. "Minimum Wage Effects Across State Borders: Estimates Using Contiguous Counties," The Review of Economics and Statistics, MIT Press, vol. 92(4), pages 945-964, November.
  11. Guy Dumais & Glenn Ellison & Edward L Glaeser, 1998. "Geographic Concentration as a Dynamic Process," Working Papers 98-3, Center for Economic Studies, U.S. Census Bureau.
  12. William Walker, 2012. "The Transitional Costs of Sectoral Reallocation: Evidence from the Clean Air Act and the Workforce," Working Papers 12-02, Center for Economic Studies, U.S. Census Bureau.
  13. Thomas J. Holmes, 1998. "The Effect of State Policies on the Location of Manufacturing: Evidence from State Borders," Journal of Political Economy, University of Chicago Press, vol. 106(4), pages 667-705, August.
  14. Neal, Derek, 1995. "Industry-Specific Human Capital: Evidence from Displaced Workers," Journal of Labor Economics, University of Chicago Press, vol. 13(4), pages 653-77, October.
  15. Matthew E. Kahn & Erin T. Mansur, 2010. "How Do Energy Prices, and Labor and Environmental Regulations Affect Local Manufacturing Employment Dynamics? A Regression Discontinuity Approach," NBER Working Papers 16538, National Bureau of Economic Research, Inc.
  16. Randy Becker & Vernon Henderson, 2000. "Effects of Air Quality Regulations on Polluting Industries," Journal of Political Economy, University of Chicago Press, vol. 108(2), pages 379-421, April.
  17. Joshua Linn, 2009. "Why Do Energy Prices Matter? The Role Of Interindustry Linkages In U.S. Manufacturing," Economic Inquiry, Western Economic Association International, vol. 47(3), pages 549-567, 07.
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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. A Preview of Chapter Four of My New Amazon Kindle Book
    by Matthew Kahn in Environmental and Urban Economics on 2013-07-27 03:04:00
  2. "Human Shields": A Thought About the Economics of Coal Mining Employment
    by Matthew Kahn in Environmental and Urban Economics on 2014-06-07 19:28:00
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Nicolai V. Kuminoff & V. Kerry Smith & Christopher Timmins, 2013. "The New Economics of Equilibrium Sorting and Policy Evaluation Using Housing Markets," Journal of Economic Literature, American Economic Association, vol. 51(4), pages 1007-62, December.
  2. Zhang, Wei & Alston, Julian M., 2013. "Factor Substitution and Technical Change in the U.S. Dairy Manufacturing Industry," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150707, Agricultural and Applied Economics Association.
  3. Siqi Zheng & Cong Sun & Ye Qi & Matthew E. Kahn, 2013. "The Evolving Geography of China’s Industrial Production: Implications for Pollution Dynamics and Urban Quality of Life," NBER Working Papers 19624, National Bureau of Economic Research, Inc.
  4. Siqi Zheng & Matthew E. Kahn, 2013. "Understanding China's Urban Pollution Dynamics," Journal of Economic Literature, American Economic Association, vol. 51(3), pages 731-72, September.

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