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Productivity growth in British manufacturing: spatial variation in the role of scale economies, technological growth and industrial structure

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  • Daniel Graham

Abstract

This paper investigates the role of scale economies, technological growth and industrial structure in creating spatial variation in manufacturing labour and Total Factor (TFP) productivity in Britain. Separate estimates of a translog specification are presented for British manufacturing firms located in defined areas of the country over the period 1994-1998. The results show that TFP change due to scale economies and technological growth has been of much less important in influencing the output growth of manufacturing firms than input growth or industrial structure. Regarding the components of TFP, technological growth has been the dominant force at play. The analysis of average labour productivity identifies shifts to other factors of production and industrial structure as being the main determinants of change, scale economies appear to have had a marginal role. The results identify spatial patterns indicating that more favourable locational effects arise for firms in areas adjacent to large urban centres, rather than for those located within cities, on the extreme periphery of the urban hinterland, or in rural areas and smaller towns.

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  • Daniel Graham, 2001. "Productivity growth in British manufacturing: spatial variation in the role of scale economies, technological growth and industrial structure," Applied Economics, Taylor & Francis Journals, vol. 33(6), pages 811-821.
    • Handle: RePEc:taf:applec:v:33:y:2001:i:6:p:811-821
    DOI: 10.1080/00036840122333
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    Cited by:

    1. Böckerman, Petri, 2002. "Understanding Regional Productivity in a Nordic Welfare State: Does ICT Matter?," Discussion Papers 798, The Research Institute of the Finnish Economy.
    2. Peridy, Nicolas, 2004. "Trade effects of scale economies: evidence from four EU countries," Economics Letters, Elsevier, vol. 83(3), pages 399-403, June.
    3. Nicolas Péridy, 2003. "Exchange rate volatility, sectoral trade, and the aggregation bias," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 139(3), pages 389-418, September.

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