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Labour Pooling in R&D Intensive Industries

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  • Gerlach, Heiko A.
  • Rønde, Thomas
  • Stahl, Konrad O.

Abstract

We investigate firms' incentives to locate in the same region to gain access to a large pool of skilled labour. Firms engage in risky R&D activities and thus create stochastic product and implied labour demand. Agglomeration in a cluster is more likely in situations where the innovation step is large and the probability for a firm to be the only innovator is high. When firms cluster, they tend to invest more and take more risk in R&D compared to spatially dispersed firms. Agglomeration is welfare-maximizing, because expected labour productivity is higher and firms choose a more efficient, technically diversified portfolio of R&D projects at the industry level.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5285.

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Date of creation: Nov 2005
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Handle: RePEc:cpr:ceprdp:5285

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Keywords: agglomeration; labour pooling; R&D;

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References

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Citations

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Cited by:
  1. Monica Andini & Guido de Blasio & Gilles Duranton & William Strange, 2012. "Marshallian Labor Market Pooling: Evidence from Italy," ERSA conference papers ersa12p467, European Regional Science Association.
  2. Gerlach, Heiko A. & Rønde, Thomas & Stahl, Konrad O., 2008. "Labor Pooling in R&D Intensive Industries," ZEW Discussion Papers 08-074, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  3. Maksim Belitski & Julia Korosteleva, 2011. "Entrepreneurship and cities: evidence from the post-communist world," ERSA conference papers ersa11p288, European Regional Science Association.
  4. Henkel, Joachim & Rønde, Thomas & Wagner, Marcus, 2010. "And the Winner Is--Acquired: Entrepreneurship as a Contest with Acquisition as the Prize," CEPR Discussion Papers 8147, C.E.P.R. Discussion Papers.
  5. Glaeser, Edward L. & Rosenthal, Stuart S. & Strange, William C., 2010. "Urban economics and entrepreneurship," Journal of Urban Economics, Elsevier, vol. 67(1), pages 1-14, January.
  6. Maksim Belitski & Julia Korosteleva, 2011. "Entrepreneurship and Cities: Evidence from the Post-communist World," WIFO Working Papers 397, WIFO.
  7. Lööf, Hans & Nabavi, Pardis, 2012. "Increasing Return To Smart Cities," Working Paper Series in Economics and Institutions of Innovation 274, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies, revised 26 Sep 2012.
  8. Ajay Agrawal, 2014. "Diaspora Networks, Knowledge Flows and Brain Drain," WIPO Economic Research Working Papers 15, World Intellectual Property Organization - Economics and Statistics Division.

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