IDEAS home Printed from https://ideas.repec.org/a/bla/growch/v40y2009i4p649-672.html
   My bibliography  Save this article

Urban versus Rural Firms: Does Location Affect Labor Demand?

Author

Listed:
  • JEAN-PIERRE HUIBAN

Abstract

A dynamic labor demand model is developed and estimated on 1,719 French firms in the food industries, observed over the period 1990-1997. Both descriptive statistics and estimation results (including GMM estimations) show that labor demand and its determinants vary according to firm location. Rural areas are characterized by a low adjustment speed and great sensitivity of labor demand to the labor cost. Peri-urban areas benefit from important economies of scale effects and from technological spillovers. Urban firms are faced with a decline in employment levels, which is mostly due to a faster adjustment of employment to the level of activity. The trade-off between agglomeration and congestion forces may explain the respective situations of both urban and periurban areas. However, the relative inertia that appears in rural areas may be analyzed in a different way, by considering the smaller number of potential opportunities that exist in these areas. Copyright (c) 2009 Wiley Periodicals, Inc..

Suggested Citation

  • Jean-Pierre Huiban, 2009. "Urban versus Rural Firms: Does Location Affect Labor Demand?," Growth and Change, Wiley Blackwell, vol. 40(4), pages 649-672.
  • Handle: RePEc:bla:growch:v:40:y:2009:i:4:p:649-672
    as

    Download full text from publisher

    File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1468-2257.2009.00504.x
    File Function: link to full text
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Riccardo Crescenzi & Andrés Rodriguez-Pose & Michael Storper, 2007. "The territorial dynamics of innovation: a Europe-United States comparative analysis," Journal of Economic Geography, Oxford University Press, vol. 7(6), pages 673-709, November.
    2. Blien, Uwe & Suedekum, Jens & Wolf, Katja, 2006. "Local employment growth in West Germany: A dynamic panel approach," Labour Economics, Elsevier, vol. 13(4), pages 445-458, August.
    3. Combes, Pierre-Philippe, 2000. "Economic Structure and Local Growth: France, 1984-1993," Journal of Urban Economics, Elsevier, vol. 47(3), pages 329-355, May.
    4. Georgios Fotopoulos, 2007. "Integrating Firm Dynamics into the Shift-Share Framework," Growth and Change, Wiley Blackwell, vol. 38(1), pages 140-152.
    5. Krugman, Paul & Elizondo, Raul Livas, 1996. "Trade policy and the Third World metropolis," Journal of Development Economics, Elsevier, vol. 49(1), pages 137-150, April.
    6. Richard Shearmur & Philippe Apparicio & Pauline Lizion & Mario Polèse, 2007. "Space, Time, and Local Employment Growth: An Application of Spatial Regression Analysis," Growth and Change, Wiley Blackwell, vol. 38(4), pages 696-722.
    7. Mary Amiti & Lisa Cameron, 2007. "Economic Geography and Wages," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 15-29, February.
    8. Jeffrey P. Cohen & Catherine J. Morrison Paul, 2003. "Spatial and supply/demand agglomeration economies: State- and industry-linkages in the U.S. food system," Empirical Economics, Springer, vol. 28(4), pages 733-751, November.
    9. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    10. Combes, Pierre-Philippe & Magnac, Thierry & Robin, Jean-Marc, 2004. "The dynamics of local employment in France," Journal of Urban Economics, Elsevier, vol. 56(2), pages 217-243, September.
    11. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    12. Mitch Renkow, 2003. "Employment Growth, Worker Mobility, and Rural Economic Development," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(2), pages 503-513.
    13. Daniel S. Hamermesh & Gerard A. Pfann, 1996. "Adjustment Costs in Factor Demand," Journal of Economic Literature, American Economic Association, vol. 34(3), pages 1264-1292, September.
    14. Ron Martin & Peter Tyler, 2000. "Regional Employment Evolutions in the European Union: A Preliminary Analysis," Regional Studies, Taylor & Francis Journals, vol. 34(7), pages 601-616, October.
    15. Richard Ericson & Ariel Pakes, 1995. "Markov-Perfect Industry Dynamics: A Framework for Empirical Work," Review of Economic Studies, Oxford University Press, vol. 62(1), pages 53-82.
    16. Mark Casson & Nigel Wadeson, 2007. "The Discovery of Opportunities: Extending the Economic Theory of the Entrepreneur," Small Business Economics, Springer, vol. 28(4), pages 285-300, April.
    17. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
    18. J. V. Henderson & J. F. Thisse (ed.), 2004. "Handbook of Regional and Urban Economics," Handbook of Regional and Urban Economics, Elsevier, edition 1, volume 4, number 4.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:growch:v:40:y:2009:i:4:p:649-672. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0017-4815 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.