The contemporary literature on urban and region economics have found strong effects of agglomerations economies in space on urban-industrial wages in developed countries. However, there is no consensus if such agglomerative effects come from either external-scale economies of productive specialization or urban agglomeration per se or from both. Our question is how these agglomerative effects on wages will take place in newly industrializing countries. We will take the Brazilian case, using the Demographic Census Database, to test if these external-scale economies exist and how are the nature of their effects on urban-industrial wages. Firstly, we will identify the relevant variables of agglomeration economies by using principal component analysis. Subsequently, we will use spatial analysis to understand the spatial distribution of the relevant variables and spatial econometrics to test the effect of agglomeration-economy variables on the urban-industrial wages.
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Length: 32 pages Date of creation: Jul 2003 Date of revision: Handle: RePEc:cdp:texdis:td213
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Find related papers by JEL classification: R1 - Urban, Rural, and Regional Economics - - General Regional Economics
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