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What Causes Agglomeration? – Policy or Infrastructure – A Study of Indian Manufacturing Industry

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  • Vinish Kathuria

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    Abstract

    This paper investigates whether industrial dispersal policy is more potent or the natural and agglomeration cost advantages are important in influencing locational choice of a firm. To carry out the analysis, an agglomeration measure given by Ellison and Glaeser is computed for 66 manufacturing industries in 21 major States of India for the year 1997-98. URL:[http://www.fgks.in/IndexServer/tifac/article/145.pdf].

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    Paper provided by eSocialSciences in its series Working Papers with number id:4473.

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    Date of creation: Sep 2011
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    Handle: RePEc:ess:wpaper:id:4473

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    Keywords: industrial dispersal policy; agglomeration cost advantages; locational choice; firm; Ellison and Glaeser; manufacturing industries; India; states; Agglomeration; Spillovers; technology; developed country; competitive markets; labour markets;

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    1. Dixit, Avinash K & Stiglitz, Joseph E, 1975. "Monopolistic Competition and Optimum Product Diversity," The Warwick Economics Research Paper Series (TWERPS) 64, University of Warwick, Department of Economics.
    2. Maurel, Francoise & Sedillot, Beatrice, 1999. "A measure of the geographic concentration in french manufacturing industries," Regional Science and Urban Economics, Elsevier, Elsevier, vol. 29(5), pages 575-604, September.
    3. Barrios, Salvador & Bertinelli, Luisito & Strobl, E. & Teixeira, Antonio-Carlos, 2005. "The dynamics of agglomeration: evidence from Ireland and Portugal," Journal of Urban Economics, Elsevier, vol. 57(1), pages 170-188, January.
    4. Fujita, Masahisa, 1988. "A monopolistic competition model of spatial agglomeration : Differentiated product approach," Regional Science and Urban Economics, Elsevier, Elsevier, vol. 18(1), pages 87-124, February.
    5. Börje Johansson & John Quigley, 2003. "Agglomeration and networks in spatial economies," Papers in Regional Science, Springer, Springer, vol. 83(1), pages 165-176, October.
    6. Devereux, Michael P & Griffith, Rachel & Simpson, Helen, 2002. "The Geographical Distribution of Production Activity in the UK," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3627, C.E.P.R. Discussion Papers.
    7. Hanushek, Eric A & Song, Byung Nak, 1978. "The Dynamics of Postwar Industrial Location," The Review of Economics and Statistics, MIT Press, vol. 60(4), pages 515-22, November.
    8. Somik Vinay Lall & Sanjoy Chakravorty, 2005. "Industrial Location and Spatial Inequality: Theory and Evidence from India," Review of Development Economics, Wiley Blackwell, Wiley Blackwell, vol. 9(1), pages 47-68, 02.
    9. Henderson, Vernon & Kuncoro, Ari & Turner, Matt, 1995. "Industrial Development in Cities," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 103(5), pages 1067-90, October.
    10. Henderson, J. Vernon, 1986. "Efficiency of resource usage and city size," Journal of Urban Economics, Elsevier, vol. 19(1), pages 47-70, January.
    11. Dirk Dohse & Sven-Christian Steude, 2003. "Concentration, Coagglomeration and Spillovers: The Geography of New Market Firms in Germany," ERSA conference papers ersa03p230, European Regional Science Association.
    12. 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.
    13. Paul Krugman, 1990. "Increasing Returns and Economic Geography," NBER Working Papers 3275, National Bureau of Economic Research, Inc.
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    15. Murphy, Kevin M & Shleifer, Andrei & Vishny, Robert W, 1989. "Industrialization and the Big Push," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 97(5), pages 1003-26, October.
    16. Guy Dumais & Glenn Ellison & Edward L. Glaeser, 2002. "Geographic Concentration As A Dynamic Process," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 193-204, May.
    17. J. A. Hausman, 1976. "Specification Tests in Econometrics," Working papers, Massachusetts Institute of Technology (MIT), Department of Economics 185, Massachusetts Institute of Technology (MIT), Department of Economics.
    18. Rosenthal, Stuart S. & Strange, William C., 2001. "The Determinants of Agglomeration," Journal of Urban Economics, Elsevier, vol. 50(2), pages 191-229, September.
    19. Paul Krugman, 1998. "Space: The Final Frontier," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 12(2), pages 161-174, Spring.
    20. Thomas J. Holmes, 1998. "The Effect of State Policies on the Location of Manufacturing: Evidence from State Borders," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 106(4), pages 667-705, August.
    21. Edward L. Glaeser, 1998. "Are Cities Dying?," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 12(2), pages 139-160, Spring.
    22. 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.
    23. Ellison, Glenn & Glaeser, Edward L, 1997. "Geographic Concentration in U.S. Manufacturing Industries: A Dartboard Approach," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 105(5), pages 889-927, October.
    24. Audretsch, David B & Feldman, Maryann P, 1996. "R&D Spillovers and the Geography of Innovation and Production," American Economic Review, American Economic Association, American Economic Association, vol. 86(3), pages 630-40, June.
    25. Goldstein, G. S. & Gronberg, T. J., 1984. "Economies of scope and economies of agglomeration," Journal of Urban Economics, Elsevier, vol. 16(1), pages 91-104, July.
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