Advanced Search
MyIDEAS: Login to save this paper or follow this series

Testing Urbanization Economies in Manufacturing Industries: Urban Diversity or Urban Size?

Contents:

Author Info

  • Shihe Fu
  • Junjie Hong
Registered author(s):

Abstract

Whether urbanization economies stem from urban diversity or urban scale is not clear in the literature. This paper uses the 2004 China manufacturing census data and tests simultaneously the effects of urban size and industrial diversity on firm productivity, controlling for localization economies and human capital externalities. We find that productivity increases with city size—but at a diminishing rate, and the city size effect becomes negative for cities with population over two million. Firms also benefit from industrial diversity, and the strength of such benefit increases with city size but decreases with firm size. The characteristics of agglomeration economies in a transition economy are also discussed.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.eeri.eu/documents/wp/EERI_RP_2010_38.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Economics and Econometrics Research Institute (EERI), Brussels in its series EERI Research Paper Series with number EERI_RP_2010_38.

as in new window
Length:
Date of creation: 18 Oct 2010
Date of revision:
Handle: RePEc:eei:rpaper:eeri_rp_2010_38

Contact details of provider:
Postal: Avenue de Beaulieu, 1160 Brussels
Phone: +322 299 3523
Fax: +322 299 3523
Email:
Web page: http://www.eeri.eu/index.htm
More information through EDIRC

Related research

Keywords: Urbanization economies; Industrial diversity; Jacobs externalities; City size.;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. J Vernon Henderson & James Davis, 2004. "The Agglomeration of Headquarters," Working Papers, Center for Economic Studies, U.S. Census Bureau 04-02, Center for Economic Studies, U.S. Census Bureau.
  2. Shihe Fu, 2005. "Smart Café Cities: Testing Human Capital Externalities in the Boston Metropolitan Area," Boston College Working Papers in Economics, Boston College Department of Economics 609, Boston College Department of Economics.
  3. Thomas J. Holmes & John J. Stevens, 2002. "Geographic Concentration and Establishment Scale," The Review of Economics and Statistics, MIT Press, vol. 84(4), pages 682-690, November.
  4. 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.
  5. Di Addario, Sabrina & Patacchini, Eleonora, 2008. "Wages and the City. Evidence from Italy," Labour Economics, Elsevier, Elsevier, vol. 15(5), pages 1040-1061, October.
  6. Gianmarco I.P. Ottaviano & Giovanni Peri, 2004. "Cities and Cultures," Working Papers, Fondazione Eni Enrico Mattei 2004.92, Fondazione Eni Enrico Mattei.
  7. Rigby, David & Brown, W. Mark & Baldwin, John R., 2008. "Agglomeration Economies: Microdata Panel Estimates from Canadian Manufacturing," Economic Analysis (EA) Research Paper Series, Statistics Canada, Analytical Studies Branch 2008049e, Statistics Canada, Analytical Studies Branch.
  8. Yukako Ono, 2002. "Outsourcing business services and the role of central administrative offices," Working Paper Series, Federal Reserve Bank of Chicago WP-02-01, Federal Reserve Bank of Chicago.
  9. Cécile BATISSE, 2001. "Dynamic externalities and local growth:A panel data analysis applied to Chinese provinces," Working Papers 200112, CERDI.
  10. Stuart S. Rosenthal & William C. Strange, 2003. "Geography, Industrial Organization, and Agglomeration," Center for Policy Research Working Papers, Center for Policy Research, Maxwell School, Syracuse University 56, Center for Policy Research, Maxwell School, Syracuse University.
  11. Wheeler, Christopher H., 2006. "Productivity and the geographic concentration of industry: The role of plant scale," Regional Science and Urban Economics, Elsevier, Elsevier, vol. 36(3), pages 313-330, May.
  12. Vernon Henderson, 2001. "Marshall's Scale Economies," Working Papers, Center for Economic Studies, U.S. Census Bureau 01-17, Center for Economic Studies, U.S. Census Bureau.
  13. Miren Lafourcade & Giordano Mion, 2005. "Concentration, agglomeration and the size of plants," PSE Working Papers, HAL halshs-00590572, HAL.
  14. Hesham M. Abdel-Rahman, 2000. "Multi-Firm City Versus Company Town: A Micro Foundation Model of Localization Economies," Journal of Regional Science, Wiley Blackwell, Wiley Blackwell, vol. 40(4), pages 755-769.
  15. Simon, Curtis J, 1988. "Frictional Unemployment and the Role of Industrial Diversity," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 103(4), pages 715-28, November.
  16. J. Vernon Henderson & Ari Kuncoro & Matthew Turner, 1992. "Industrial Development in Cities," NBER Working Papers 4178, National Bureau of Economic Research, Inc.
  17. Gilles Duranton & Diego Puga, 1999. "Diversity and specialisation in cities: why, where and when does it matter?," LSE Research Online Documents on Economics, London School of Economics and Political Science, LSE Library 20212, London School of Economics and Political Science, LSE Library.
  18. Rigby, David & Brown, W. Mark & Beckstead, Desmond & Baldwin, John R., 2007. "Urban Economies and Productivity," Economic Analysis (EA) Research Paper Series, Statistics Canada, Analytical Studies Branch 2007045e, Statistics Canada, Analytical Studies Branch.
  19. Nakamura, Ryohei, 1985. "Agglomeration economies in urban manufacturing industries: A case of Japanese cities," Journal of Urban Economics, Elsevier, vol. 17(1), pages 108-124, January.
  20. Sveikauskas, Leo A, 1975. "The Productivity of Cities," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 89(3), pages 393-413, August.
  21. Segal, David, 1976. "Are There Returns to Scale in City Size?," The Review of Economics and Statistics, MIT Press, vol. 58(3), pages 339-50, August.
  22. Moomaw, Ronald L., 1985. "Firm location and city size: Reduced productivity advantages as a factor in the decline of manufacturing in urban areas," Journal of Urban Economics, Elsevier, vol. 17(1), pages 73-89, January.
  23. Moomaw, Ronald L, 1981. "Productivity and City Size? A Critique of the Evidence [Are There Returns to Scale in City Size?]. [Bias in the Cross Section Estimates of the Elasticity of Substitution]," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 96(4), pages 675-88, November.
  24. Melo, Patricia C. & Graham, Daniel J. & Noland, Robert B., 2009. "A meta-analysis of estimates of urban agglomeration economies," Regional Science and Urban Economics, Elsevier, Elsevier, vol. 39(3), pages 332-342, May.
  25. John M. Quigley, 1998. "Urban Diversity and Economic Growth," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 12(2), pages 127-138, Spring.
  26. Rosenthal, Stuart S. & Strange, William C., 2001. "The Determinants of Agglomeration," Journal of Urban Economics, Elsevier, vol. 50(2), pages 191-229, September.
  27. Chun-Chung Au & J. Vernon Henderson, 2006. "Are Chinese Cities Too Small?," Review of Economic Studies, Oxford University Press, vol. 73(3), pages 549-576.
  28. Lourens Broersma & Jan Oosterhaven, 2009. "Regional Labor Productivity In The Netherlands: Evidence Of Agglomeration And Congestion Effects," Journal of Regional Science, Wiley Blackwell, Wiley Blackwell, vol. 49(3), pages 483-511.
  29. Hartog,Joop & Maassen van den Brink,Henriëtte (ed.), 2007. "Human Capital," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521873161.
  30. Arnott, Richard, 1979. "Optimal city size in a spatial economy," Journal of Urban Economics, Elsevier, vol. 6(1), pages 65-89, January.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:eei:rpaper:eeri_rp_2010_38. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julia van Hove).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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