Mapping Sectoral Patterns of Technological Accumulation into the Geography of Corporate Locations. A Simple Model and Some Promising Evidence
AbstractEconomies of agglomeration are central in understanding the emergence of industrial clustering. However, existing models that incorporate economies of agglomeration to explain industrial concentration have been providing a quite small set of empirically testable predictions. In this paper, we propose a baseline model in which myopic firms make reversible locational choices in presence of dynamic increasing returns from agglomeration. Despite its simplicity, the model is able to deliver predictions about the long-run distribution of the size of spatial clusters. We test the predictions of the model against data on geographical distribution of Italian firms across industrial districts. We show that, at least in some benchmark industries, accordance of theoretical predictions with data is quite high. Finally, we explore the extents to which industrial sectors exhibit different economies of agglomeration. We find that geographical clustering is highly affected by intersectoral differences in industrial innovation patterns and learning regimes.
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Bibliographic InfoPaper provided by Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy in its series LEM Papers Series with number 2002/21.
Date of creation: 25 Dec 2002
Date of revision:
Location Dynamics; Industrial Clustering; Economies of Agglomeration; Firm Locational Choice.;
Other versions of this item:
- Giulio Bottazzi & Giorgio Fagiolo & Giovanni Dosi, 2003. "Mapping Sectoral Patterns of Technological Accumulation into the Geography of Corporate Locations. A Simple Model and Some Promising Evidence," Computing in Economics and Finance 2003 268, Society for Computational Economics.
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
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