IDEAS home Printed from https://ideas.repec.org/a/oup/revage/v27y2005i1p89-103.html
   My bibliography  Save this article

Industry Agglomeration and Investment in Rural Businesses

Author

Listed:
  • Todd M. Gabe

Abstract

This paper examines the effects of local industry agglomeration on investments in equipment and machinery by businesses located in Maine. Descriptive analysis of the data indicates that a substantial amount of the investments in nonmetropolitan counties and small towns occurred in high-agglomeration county-industries. However, econometric results imply that, while positive, the effects of agglomeration on investment are somewhat modest. Further analysis of industry-specific descriptive statistics provides mixed evidence on the connection between business investment and local industry agglomeration. These results suggest that local policymakers should proceed with caution when implementing cluster-based economic development strategies. Copyright 2005, Oxford University Press.

Suggested Citation

  • Todd M. Gabe, 2005. "Industry Agglomeration and Investment in Rural Businesses," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 27(1), pages 89-103.
    • Handle: RePEc:oup:revage:v:27:y:2005:i:1:p:89-103
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/j.1467-9353.2004.00209.x
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. anonymous, 1995. "Does the bouncing ball lead to economic growth?," Regional Update, Federal Reserve Bank of Atlanta, issue Jul, pages 1-2,4-6.
    3. Robert J. Barro, 2013. "Inflation and Economic Growth," Annals of Economics and Finance, Society for AEF, vol. 14(1), pages 121-144, May.
    4. Adam B. Jaffe & Manuel Trajtenberg & Rebecca Henderson, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(3), pages 577-598.
    5. Glaeser, Edward L & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1992. "Growth in Cities," Journal of Political Economy, University of Chicago Press, vol. 100(6), pages 1126-1152, December.
      • Edward L. Glaeser & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1991. "Growth in Cities," NBER Working Papers 3787, National Bureau of Economic Research, Inc.
      • Glaeser, Edward Ludwig & Kallal, Hedi D. & Scheinkman, Jose A. & Shleifer, Andrei, 1992. "Growth in Cities," Scholarly Articles 3451309, Harvard University Department of Economics.
    6. Todd Gabe, 2003. "Local Industry Agglomeration and New Business Activity," Growth and Change, Wiley Blackwell, vol. 34(1), pages 17-39, February.
    7. Dmitriy Stolyarov & Boyan Jovanovic, 2000. "Optimal Adoption of Complementary Technologies," American Economic Review, American Economic Association, vol. 90(1), pages 15-29, March.
    8. Deaton, Brady J. & Nelson, Glenn L., 1992. "Conceptual Underpinnings Of Policy Analysis For Rural Development," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 24(1), pages 1-13, July.
    9. Ellison, Glenn & Glaeser, Edward L, 1997. "Geographic Concentration in U.S. Manufacturing Industries: A Dartboard Approach," Journal of Political Economy, University of Chicago Press, vol. 105(5), pages 889-927, October.
    10. Yunsoo Kim & David L. Barkley & Mark S. Henry, 2000. "Industry Characteristics Linked to Establishment Concentrations in Nonmetropolitan Areas," Journal of Regional Science, Wiley Blackwell, vol. 40(2), pages 234-259, May.
    11. John Haltiwanger & Russell Cooper & Laura Power, 1999. "Machine Replacement and the Business Cycle: Lumps and Bumps," American Economic Review, American Economic Association, vol. 89(4), pages 921-946, September.
    12. Deaton, Brady J. & Nelson, Glenn L., 1992. "Conceptual Underpinnings Of Policy Analysis For Rural Development," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 24(1), pages 87-99, July.
    13. Henderson, Vernon & Kuncoro, Ari & Turner, Matt, 1995. "Industrial Development in Cities," Journal of Political Economy, University of Chicago Press, vol. 103(5), pages 1067-1090, October.
    14. Xavier Sala-I-Martin, 1997. "Transfers, Social Safety Nets, and Economic Growth," IMF Staff Papers, Palgrave Macmillan, vol. 44(1), pages 81-102, March.
    15. Henderson, Vernon, 1997. "Externalities and Industrial Development," Journal of Urban Economics, Elsevier, vol. 42(3), pages 449-470, November.
    16. Emery N. Castle, 1998. "A Conceptual Framework for the Study of Rural Places," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(3), pages 621-631.
    17. Levenson, Alec R & Willard, Kristen L, 2000. "Do Firms Get the Financing They Want? Measuring Credit Rationing Experienced by Small Business in the U.S," Small Business Economics, Springer, vol. 14(2), pages 83-94, March.
    18. Henderson, J. Vernon, 1986. "Efficiency of resource usage and city size," Journal of Urban Economics, Elsevier, vol. 19(1), pages 47-70, January.
    19. Dagney Faulk, 2001. "The Participation of Firms in Tax Incentive Programs," The Review of Regional Studies, Southern Regional Science Association, vol. 31(1), pages 39-50, Summer.
    20. Gale, Jr., H. Frederick, 1998. "Labor Productivity and Wages in Rural and Urban Manufacturing Plants," The Review of Regional Studies, Southern Regional Science Association, vol. 28(1), pages 13-26, Summer.
    21. Gabe, Todd M. & Kraybill, David S., 1998. "Tax Incentive Requests and Offers in a State Economic Development Program," The Review of Regional Studies, Southern Regional Science Association, vol. 28(3), pages 1-14, Winter.
    22. David L. Barkley & Mark S. Henry, 1997. "Rural Industrial Development: To Cluster or Not to Cluster?," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 19(2), pages 308-325.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Marasteanu, I. Julia & Jaenicke, Edward C., 2013. "Agglomeration and Spatial Dependence in Certified Organic Operations in the United States," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 149551, Agricultural and Applied Economics Association.
    2. Lambert, Dayton M. & McNamara, Kevin T. & Garrett, Megan I., 2006. "An Application of Spatial Poisson Models to Manufacturing Investment Location Analysis," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 38(1), pages 1-17, April.
    3. Georgeanne M. Artz & Younjun Kim & Peter F. Orazem, 2016. "Does Agglomeration Matter Everywhere?: New Firm Location Decisions In Rural And Urban Markets," Journal of Regional Science, Wiley Blackwell, vol. 56(1), pages 72-95, January.
    4. Brache, Jose & Felzensztein, Christian, 2019. "Geographical co-location on Chilean SME's export performance," Journal of Business Research, Elsevier, vol. 105(C), pages 310-321.
    5. Marasteanu, I. Julia & Jaenicke, Edward C., 2014. "Clusters of Organic Operations and their Impact on Regional Economic Growth in the United States," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170336, Agricultural and Applied Economics Association.
    6. repec:rre:publsh:v:36:y:2006:i:2:p:140-62 is not listed on IDEAS
    7. Hans Lööf & Pardis Nabavi, 2014. "Survival, productivity and growth of new ventures across locations," Small Business Economics, Springer, vol. 43(2), pages 477-491, August.
    8. Maureen Kilkenny, 2010. "Urban/Regional Economics And Rural Development," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 449-470, February.
    9. Jaenicke, Edward C. & Goetz, Stephan J. & Wu, Ping-Chao & Dimitri, Carolyn, 2009. "Identifying and Measuring the Effect of Firm Clusters Among Certified Organic Processors and Handlers," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49205, Agricultural and Applied Economics Association.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Todd M. Gabe, 2004. "Establishment Growth in Small Cities and Towns," International Regional Science Review, , vol. 27(2), pages 164-186, April.
    2. Todd Gabe & Jaison R. Abel, 2011. "Agglomeration of Knowledge," Urban Studies, Urban Studies Journal Limited, vol. 48(7), pages 1353-1371, May.
    3. Oliver Farhauer & Alexandra Kröll, 2012. "Diversified specialisation—going one step beyond regional economics’ specialisation-diversification concept," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 32(1), pages 63-84, March.
    4. Alberto Franco Pozzolo, 2004. "Research and Development, Regional Spillovers and the Location of Economic Activities," Manchester School, University of Manchester, vol. 72(4), pages 463-482, July.
    5. Stuart S. Rosenthal & William C. Strange, 2003. "Geography, Industrial Organization, and Agglomeration," The Review of Economics and Statistics, MIT Press, vol. 85(2), pages 377-393, May.
    6. Delgado, Mercedes & Porter, Michael E. & Stern, Scott, 2014. "Clusters, convergence, and economic performance," Research Policy, Elsevier, vol. 43(10), pages 1785-1799.
    7. Combes, Pierre-Philippe & Magnac, Thierry & Robin, Jean-Marc, 2004. "The dynamics of local employment in France," Journal of Urban Economics, Elsevier, vol. 56(2), pages 217-243, September.
    8. J. Vernon Henderson, 2001. "Marshall's Scale Economies," Working Papers 2001-46, Brown University, Department of Economics.
    9. Miguel Ángel García & Ivan Muñiz, 2005. "El impacto espacial de las economías de aglomeración y su efecto sobre la estructura urbana.El caso de la industria en Barcelona, 1986-1996," Working Papers wpdea0509, Department of Applied Economics at Universitat Autonoma of Barcelona.
    10. Henderson, J. Vernon, 2003. "Marshall's scale economies," Journal of Urban Economics, Elsevier, vol. 53(1), pages 1-28, January.
    11. Beaudry, Catherine & Schiffauerova, Andrea, 2009. "Who's right, Marshall or Jacobs? The localization versus urbanization debate," Research Policy, Elsevier, vol. 38(2), pages 318-337, March.
    12. Aitken, Brian & Hanson, Gordon H. & Harrison, Ann E., 1997. "Spillovers, foreign investment, and export behavior," Journal of International Economics, Elsevier, vol. 43(1-2), pages 103-132, August.
    13. Edward L. Glaeser & William R. Kerr, 2009. "Local Industrial Conditions and Entrepreneurship: How Much of the Spatial Distribution Can We Explain?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 18(3), pages 623-663, September.
    14. Faberman, R. Jason & Freedman, Matthew, 2016. "The urban density premium across establishments," Journal of Urban Economics, Elsevier, vol. 93(C), pages 71-84.
    15. Stéphane Riou, 2003. "Géographie, croissance et politique de cohésion en Europe," Revue Française d'Économie, Programme National Persée, vol. 17(3), pages 171-220.
    16. Bun Song Lee & Kim Sosin & Sung Hyo Hong, 2005. "Sectoral Manufacturing Productivity Growth in Korean Regions," Urban Studies, Urban Studies Journal Limited, vol. 42(7), pages 1201-1219, June.
    17. Jens Suedekum & Uwe Blien, 2005. "Local Economic Structure and Industry Development in Germany, 1993-2001," Economics Bulletin, AccessEcon, vol. 15(17), pages 1-8.
    18. Fu, Shihe, 2007. "Smart Cafe Cities: Testing human capital externalities in the Boston metropolitan area," Journal of Urban Economics, Elsevier, vol. 61(1), pages 86-111, January.
    19. Daniel da Mata & Uwe Deichmann & J. Vernon Henderson & Somik V. Lall & Hyoung G. Wang, 2005. "Examining the Growth Patterns of Brazilian Cities," Discussion Papers 1113, Instituto de Pesquisa Econômica Aplicada - IPEA.
    20. Blien, Uwe & Suedekum, Jens & Wolf, Katja, 2006. "Local employment growth in West Germany: A dynamic panel approach," Labour Economics, Elsevier, vol. 13(4), pages 445-458, August.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:revage:v:27:y:2005:i:1:p:89-103. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press or Christopher F. Baum (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.