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The Influence Of Location On Productivity: Manufacturing Technology In Rural And Urban Areas

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  • Sheila A Martin
  • Richard Mchugh
  • S R Johnson
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    Abstract

    Policies to counter the growing discrepancy between economic opportunities in rural and urban areas have focused predominantly on expanding manufacturing in rural areas. Fundamental to the design of these strategies are the relative costs of production and productivity of manufacturing in rural and urban areas. This study aims to develop information that can be used to assess the productivity of manufacturing in rural and urban areas. Production functions are estimated in the meat products and household furniture industries to investigate selected aspects of the effect of rural, small urban, and metropolitan location on productivity. The results show that the effect of location on productivity varies with industry, size, and the timing of the entry of the establishment into the industry. While the analysis is specific to two industries, it suggests that development policies targeting manufacturing can be made more effective by focusing on industries and plants with characteristics that predispose them to the locations being supported.

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    File URL: ftp://ftp2.census.gov/ces/wp/1991/CES-WP-91-10.pdf
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    Bibliographic Info

    Paper provided by Center for Economic Studies, U.S. Census Bureau in its series Working Papers with number 91-10.

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    Date of creation: Dec 1991
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    Handle: RePEc:cen:wpaper:91-10

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    Keywords: CES; economic; research; micro; data; microdata; chief; economist;

    References

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    1. Guilkey, David K & Lovell, C A Knox & Sickles, Robin C, 1983. "A Comparison of the Performance of Three Flexible Functional Forms," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 24(3), pages 591-616, October.
    2. Daniel M. Otto & Stanley R. Johnson & Helen H. Jensen & Sheila A. Martin, 1988. "Rural Economic Development Policies for the Midwestern States," Center for Agricultural and Rural Development (CARD) Publications 88-wp35, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    3. Gallant, A. Ronald & Jorgenson, Dale W., 1979. "Statistical inference for a system of simultaneous, non-linear, implicit equations in the context of instrumental variable estimation," Journal of Econometrics, Elsevier, vol. 11(2-3), pages 275-302.
    4. McHugh, Richard & Lane, Julia, 1990. "Embodied Technological Change and Tests of the Internal-Adjustment-Cost Hypothesis," Journal of Business & Economic Statistics, American Statistical Association, vol. 8(4), pages 459-64, October.
    5. Frank R. Lichtenberg & Donald Siegel, 1987. "Productivity and Changes in Ownership of Manufactoring Plants," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 18(3), pages 643-684.
    6. Robert H Mcguckin & George A Pascoe, 1988. "The Longitudinal Research Database (LRD): Status And Research Possibilities," Working Papers 88-2, Center for Economic Studies, U.S. Census Bureau.
    7. Lichtenberg, Frank R, 1988. "Estimation of the Internal Adjustment Costs Model Using Longitudinal Establishment Data," The Review of Economics and Statistics, MIT Press, vol. 70(3), pages 421-30, August.
    8. Diewert, Walter E & Wales, Terence J, 1987. "Flexible Functional Forms and Global Curvature Conditions," Econometrica, Econometric Society, vol. 55(1), pages 43-68, January.
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    Cited by:
    1. George A. Erickcek & Hannah McKinney, 2004. "Small Cities Blues: Looking for Growth Factors in Small and Medium-Sized Cities," Upjohn Working Papers and Journal Articles 04-100, W.E. Upjohn Institute for Employment Research.
    2. Suho Bae, 2009. "The responses of manufacturing businesses to geographical differences in electricity prices," The Annals of Regional Science, Springer, vol. 43(2), pages 453-472, June.

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