Industrial relocation policy and heterogeneous plants sorted by productivity: Evidence from Japan
AbstractIn an economic geography model with firm heterogeneity, Baldwin and Okubo (2006) show that regional policies for promoting periphery development attract low-productivity firms and adversely affect the productivity gap within a country. This paper empirically examines their theoretical prediction by using plant-level data during active relocation policies in Japan. Our estimation results from plant-level regressions and propensity-score matching are generally consistent with the theory. As compared to other regions, those targeted by policies, especially by industrial relocation subsidy programs, tend to have low-productivity plants.
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Bibliographic InfoPaper provided by Research Institute for Economics & Business Administration, Kobe University in its series Discussion Paper Series with number DP2010-35.
Length: 36 pages
Date of creation: Dec 2010
Date of revision:
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- OKUBO Toshihiro & TOMIURA Eiichi, 2010. "Industrial Relocation Policy and Heterogeneous Plants Sorted by Productivity: Evidence from Japan," Discussion papers 10016, Research Institute of Economy, Trade and Industry (RIETI).
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