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Productivity and Local Workforce Composition

Author

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  • David C. Maré

    (Motu Economic and Public Policy Research)

  • Richard Fabling

    (Reserve Bank of New Zealand)

Abstract

This chapter examines the link between firm productivity and the population composition of the areas in which firms operate. We combine annual firm-level microdata on production, covering a large proportion of the New Zealand economy, with area-level workforce characteristics obtained from population censuses. Overall, the results support the existence of agglomeration effects that operate through labour markets. We find evidence of productive spillovers from operating in areas with high-skilled workers, and with high population density. A high-skilled local workforce benefits firms in high-skilled and high-research and development industries, and small firms. The benefits of local population density are strongest for firms in dense areas, and for small and new firms. Firms providing local services are more productive in areas with high shares of migrants and new entrants, consistent with local demand factors.

Suggested Citation

  • David C. Maré & Richard Fabling, 2011. "Productivity and Local Workforce Composition," Working Papers 11_10, Motu Economic and Public Policy Research.
    • Handle: RePEc:mtu:wpaper:11_10
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    Cited by:

    1. Richard Fabling & David C. Maré, 2020. "Measuring commute patterns over time: Using administrative data to identify where employees live and work," Working Papers 20_05, Motu Economic and Public Policy Research.
    2. Richard Fabling & David C Maré, 2015. "Production function estimation using New Zealand’s Longitudinal Business Database," Working Papers 15_15, Motu Economic and Public Policy Research.
    3. Nathan, Max, 2013. "The Wider Economic Impacts of High-Skilled Migrants: A Survey of the Literature," IZA Discussion Papers 7653, Institute of Labor Economics (IZA).
    4. Max Nathan, 2014. "The wider economic impacts of high-skilled migrants: a survey of the literature for receiving countries," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-20, December.
    5. Max Nathan & Neil Lee, 2013. "Cultural Diversity, Innovation, and Entrepreneurship: Firm-level Evidence from London," Economic Geography, Clark University, vol. 89(4), pages 367-394, October.
    6. David C. Maré & Dean R. Hyslop & Richard Fabling, 2017. "Firm productivity growth and skill," New Zealand Economic Papers, Taylor & Francis Journals, vol. 51(3), pages 302-326, September.
    7. Max Nathan, 2013. "Top Team Demographics, Innovation and Business Performance: Findings from English Firms and Cities 2008-9," SERC Discussion Papers 0129, Centre for Economic Performance, LSE.
    8. Dr Max Nathan, 2013. "The wider economic impacts of high-skilled migrants: a survey of the literature," National Institute of Economic and Social Research (NIESR) Discussion Papers 413, National Institute of Economic and Social Research.
    9. Julie Fry, 2014. "Migration and Macroeconomic Performance in New Zealand: Theory and Evidence," Treasury Working Paper Series 14/10, New Zealand Treasury.
    10. Richard Fabling & David C Maré & Philip Stevens, 2022. "Migration and firm-level productivity," Working Papers 2022/01, New Zealand Productivity Commission.
    11. Nathan, Max, 2014. "Top Team Diversity and Business Performance: Latent Class Analysis for Firms and Cities," IZA Discussion Papers 8462, Institute of Labor Economics (IZA).
    12. David C. Maré & Jacques Poot, 2019. "Valuing cultural diversity of cities," Working Papers 19_05, Motu Economic and Public Policy Research.
    13. Nathan, Max, 2013. "Top team demographics, innovation and business performance: findings from English firms and cities 2008-9," LSE Research Online Documents on Economics 59250, London School of Economics and Political Science, LSE Library.

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    More about this item

    Keywords

    productivity; agglomeration; workforce composition;
    All these keywords.

    JEL classification:

    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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