Weighting Ripley’s K-function to account for the firm dimension in the analysis of spatial concentration
AbstractThe spatial concentration of firms has long been a central issue in economics both under the theoretical and the applied point of view due mainly to the important policy implications. A popular approach to its measurement, which does not suffer from the problem of the arbitrariness of the regional boundaries, makes use of micro data and looks at the firms as if they were dimensionless points distributed in the economic space. However in practical circumstances the points (firms) observed in the economic space are far from being dimensionless and are conversely characterized by different dimension in terms of the number of employees, the product, the capital and so on. In the literature, the works that originally introduce such an approach (e.g. Arbia and Espa, 1996; Marcon and Puech, 2003) disregard the aspect of the different firm dimension and ignore the fact that a high degree of spatial concentration may result from both the case of many small points clustering in definite portions of space and from only few large points clustering together (e.g. few large firms). We refer to this phenomena as to clustering of firms and clustering of economic activities. The present paper aims at tackling this problem by adapting the popular Kfunction (Ripley, 1977) to account for the point dimension using the framework of marked point process theory (Penttinen, 2006)
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Bibliographic InfoPaper provided by Department of Economics, University of Trento, Italia in its series Department of Economics Working Papers with number 1012.
Date of creation: 2010
Date of revision:
Agglomeration; Marked point processes; Spatial clusters; Spatial econometrics;
Find related papers by JEL classification:
- C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
- D92 - Microeconomics - - Intertemporal Choice and Growth - - - Intertemporal Firm Choice and Growth, Financing, Investment, and Capacity
- L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-10-23 (All new papers)
- NEP-GEO-2010-10-23 (Economic Geography)
- NEP-URE-2010-10-23 (Urban & Real Estate Economics)
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