In Japan, the manufacturing has become geographically dispersed in the 1990s, when the import share has risen after the historic exchange rate appreciation. As is consistent with the interpretation that import penetration undermines regional input-output linkages, our regressions detect the significant decline of industrial concentrations previously established near output absorbers, especially in industries with high import share growths. This paper also finds that local knowledge spillovers and immobile specialized labor affect regional growth. Thus, while regional demand of tradable outputs matters less, regional supply of inputs, especially non-tradable inputs, remains critical for manufacturing locations.
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number
9899.
Length: Date of creation: Aug 2003 Date of revision: Handle: RePEc:nbr:nberwo:9899
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Find related papers by JEL classification: R12 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography) R34 - Urban, Rural, and Regional Economics - - Production Analysis and Firm Location - - - Input Demand Analysis
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