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Does Spatial Proximity Matter? Micro-evidence from Italy

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  • Cainelli, Giulio

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  • Lupi, Claudio

    ()

Abstract

The effect of spatial agglomeration (localisation and urbanisation economies) on employment growth is explored over a balanced panel of 23,374 Italian firms, using a flexible Bayesian model. Contrary to previous research, the agglomeration economies measures are calculated using direct measures of physical distances between pairs of firms, rather than with respect to pre-specified geographical units. We find that localisation effects are positive but decreasing with distance, while the variety effects are negative for distances within 10 kilometers and become positive for distances in a range of 10-30 kilometers. Our results suggest that the use of geographic units such as standard metropolitan units, LLS, administrative regions or provinces can be misleading.

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File URL: http://web.unimol.it/progetti/repec/mol/ecsdps/ESDP08042.pdf
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Bibliographic Info

Paper provided by University of Molise, Dept. EGSeI in its series Economics & Statistics Discussion Papers with number esdp08042.

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Length: 27 pages
Date of creation: 22 Feb 2008
Date of revision:
Publication status: Published in N. De Liso and R. Leoncini (Eds.), 2010. Internationalization, Technological Change and the Theory of the Firm. London, Routledge.
Handle: RePEc:mol:ecsdps:esdp08042

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Keywords: Proximity; agglomeration; knowledge spillover; employment.;

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References

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Cited by:
  1. Raimund Krumm & Harald Strotmann, 2013. "The impact of regional location factors on job creation, job destruction and employment growth in manufacturing," Jahrbuch für Regionalwissenschaft, Springer, vol. 33(1), pages 23-48, February.
  2. Juliette Milgram-Baleix, 2009. "Do Spanish firms learn from firms located nearby?," Economic Working Papers at Centro de Estudios Andaluces E2009/09, Centro de Estudios Andaluces.
  3. Susanna Mancinelli & Massimiliano Mazzanti, 2009. "Innovation, networking and complementarity: evidence on SME performances for a local economic system in North-Eastern Italy," The Annals of Regional Science, Springer, vol. 43(3), pages 567-597, September.
  4. Raimund Krumm & Harald Strotmann, 2010. "The Impact of Regional Supply and Demand Conditions on Job Creation and Destruction," IAW Discussion Papers 61, Institut für Angewandte Wirtschaftsforschung (IAW).
  5. Matthias Duschl & Antje Schimke & Thomas Brenner & Dennis Luxen, 2014. "Firm Growth and the Spatial Impact of Geolocated External Factors," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 234(2-3), pages 234-256, April.

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