IDEAS home Printed from https://ideas.repec.org/a/eee/jbrese/v69y2016i5p1874-1879.html
   My bibliography  Save this article

A dynamic analysis of the agglomeration and performance relationship

Author

Listed:
  • Marco-Lajara, Bartolomé
  • Claver-Cortés, Enrique
  • Úbeda-García, Mercedes
  • Zaragoza-Sáez, Patrocinio del Carmen

Abstract

This study takes a dynamic approach to the study of the economies of agglomeration in the tourist districts of the Spanish Mediterranean coast. Results suggest that company growth has a U-shaped relationship with the degree of agglomeration, which means that first levels of agglomeration profits decrease until they reach a certain point of agglomeration, from which business growth begins to increase. This process means that hotels in tourist districts with a high degree of agglomeration are not only more profitable at a given moment of time, but these hotels even increase their competitiveness with time. This increased competitiveness owes to the fact that the profitability of these hotels grows faster. The analysis also determines that costs are the cause of this behavior because costs grow more quickly when the degree of agglomeration is low, but after some time, the externalities resulting from agglomeration imply a progressive reduction of business costs.

Suggested Citation

  • Marco-Lajara, Bartolomé & Claver-Cortés, Enrique & Úbeda-García, Mercedes & Zaragoza-Sáez, Patrocinio del Carmen, 2016. "A dynamic analysis of the agglomeration and performance relationship," Journal of Business Research, Elsevier, vol. 69(5), pages 1874-1879.
  • Handle: RePEc:eee:jbrese:v:69:y:2016:i:5:p:1874-1879
    DOI: 10.1016/j.jbusres.2015.10.072
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0148296315004956
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.jbusres.2015.10.072?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    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. Maré, David C. & Graham, Daniel J., 2013. "Agglomeration elasticities and firm heterogeneity," Journal of Urban Economics, Elsevier, vol. 75(C), pages 44-56.
    2. Vittorio Galletto & Rafael Boix, 2008. "Marshallian Industrial Districts in Spain," SCIENZE REGIONALI, FrancoAngeli Editore, vol. 2008(3), pages 29-52.
    3. Rafael Boix & Vittorio Galletto, 2009. "Innovation and Industrial Districts: A First Approach to the Measurement and Determinants of the I-District Effect," Regional Studies, Taylor & Francis Journals, vol. 43(9), pages 1117-1133.
    4. Ehrl, Philipp, 2013. "Agglomeration economies with consistent productivity estimates," Regional Science and Urban Economics, Elsevier, vol. 43(5), pages 751-763.
    5. Wilbur Chung & Arturs Kalnins, 2001. "Agglomeration effects and performance: a test of the Texas lodging industry," Strategic Management Journal, Wiley Blackwell, vol. 22(10), pages 969-988, October.
    6. Henderson, Vernon & Kuncoro, Ari & Turner, Matt, 1995. "Industrial Development in Cities," Journal of Political Economy, University of Chicago Press, vol. 103(5), pages 1067-1090, October.
    7. Folta, Timothy B. & Cooper, Arnold C. & Baik, Yoon-suk, 2006. "Geographic cluster size and firm performance," Journal of Business Venturing, Elsevier, vol. 21(2), pages 217-242, March.
    8. Jo Thori Lind & Halvor Mehlum, 2010. "With or Without U? The Appropriate Test for a U‐Shaped Relationship," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 72(1), pages 109-118, February.
    9. Wagner, Alfred, 1891. "Marshall's Principles of Economics," History of Economic Thought Articles, McMaster University Archive for the History of Economic Thought, vol. 5, pages 319-338.
    10. David L. Rigby & W. Mark Brown, 2015. "Who Benefits from Agglomeration?," Regional Studies, Taylor & Francis Journals, vol. 49(1), pages 28-43, January.
    11. McKercher, Bob & Wong, Celia & Lau, Gigi, 2006. "How tourists consume a destination," Journal of Business Research, Elsevier, vol. 59(5), pages 647-652, May.
    12. Bartolomé Marco-Lajara & Mercedes Úbeda-García & Vicente Sabater-Sempere & Francisco García-Lillo, 2014. "Territory Impact on the Performance of Spanish Vacation Hotels," Tourism Economics, , vol. 20(4), pages 779-796, August.
    13. Glaeser, Edward L & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1992. "Growth in Cities," Journal of Political Economy, University of Chicago Press, vol. 100(6), pages 1126-1152, December.
      • Edward L. Glaeser & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1991. "Growth in Cities," NBER Working Papers 3787, National Bureau of Economic Research, Inc.
      • Glaeser, Edward Ludwig & Kallal, Hedi D. & Scheinkman, Jose A. & Shleifer, Andrei, 1992. "Growth in Cities," Scholarly Articles 3451309, Harvard University Department of Economics.
    14. Hosany, Sameer & Ekinci, Yuksel & Uysal, Muzaffer, 2006. "Destination image and destination personality: An application of branding theories to tourism places," Journal of Business Research, Elsevier, vol. 59(5), pages 638-642, May.
    15. Arturs Kalnins & Wilbur Chung, 2006. "Social Capital, Geography, and Survival: Gujarati Immigrant Entrepreneurs in the U.S. Lodging Industry," Management Science, INFORMS, vol. 52(2), pages 233-247, February.
    16. Juan Alcácer & Wilbur Chung, 2014. "Location strategies for agglomeration economies," Strategic Management Journal, Wiley Blackwell, vol. 35(12), pages 1749-1761, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wang, Liang & Tan, Justin & Li, Wan, 2018. "The impacts of spatial positioning on regional new venture creation and firm mortality over the industry life cycle," Journal of Business Research, Elsevier, vol. 86(C), pages 41-52.
    2. María D. Illescas-Manzano & Sergio Martínez-Puertas & Gema M. Marín-Carrillo & María B. Marín-Carrillo, 2023. "Dynamics of agglomeration and competition in the hotel industry: A geographically weighted regression analysis based on an analytical hierarchy process and geographic information systems (GIS) data," Oeconomia Copernicana, Institute of Economic Research, vol. 14(1), pages 213-252, March.
    3. Oddne Skrede & Sigbjorn Landazuri Tveteraas, 2019. "Cruise spillovers to hotels and restaurants," Tourism Economics, , vol. 25(8), pages 1286-1301, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lee, Yong-Jin Alex & Jang, Seongsoo & Kim, Jinwon, 2020. "Tourism clusters and peer-to-peer accommodation," Annals of Tourism Research, Elsevier, vol. 83(C).
    2. Combes, Pierre-Philippe & Gobillon, Laurent, 2015. "The Empirics of Agglomeration Economies," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 247-348, Elsevier.
    3. Theresa Chaudhry & Muhammad Haseeb & Maryiam Haroon, 2017. "Economic geography and misallocation in Pakistan’s manufacturing hub," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 59(1), pages 189-208, July.
    4. J Knoben & AT Arikan & F van Oort & O Raspe, 2016. "Agglomeration and firm performance: One firm’s medicine is another firm’s poison," Environment and Planning A, , vol. 48(1), pages 132-153, January.
    5. Cui Zhang, 2017. "Top manager characteristics, agglomeration economies and firm performance," Small Business Economics, Springer, vol. 48(3), pages 543-558, March.
    6. Carlos Carreira & Luís Lopes, 2016. "Collecting new pieces to the regional knowledge spillovers puzzle: high-tech versus low-tech industries," GEMF Working Papers 2016-06, GEMF, Faculty of Economics, University of Coimbra.
    7. Emanuela Marrocu & Raffaele Paci & Stefano Usai, 2013. "Productivity Growth In The Old And New Europe: The Role Of Agglomeration Externalities," Journal of Regional Science, Wiley Blackwell, vol. 53(3), pages 418-442, August.
    8. Carlos Carreira & Luís Lopes, 2016. "Collecting new pieces to the regional knowledge spillovers puzzle: high-tech versus low-tech industries," GEMF Working Papers 2016-06, GEMF, Faculty of Economics, University of Coimbra.
    9. Carlino, Gerald & Kerr, William R., 2015. "Agglomeration and Innovation," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 349-404, Elsevier.
    10. Giulia Faggio & Olmo Silva & William C Strange, 2020. "Tales of the city: what do agglomeration cases tell us about agglomeration in general? [The anchor tenant hypothesis: exploring the role of large, local, R&D-intensive firms in regional innovation ," Journal of Economic Geography, Oxford University Press, vol. 20(5), pages 1117-1143.
    11. Berliant, Marcus & Reed III, Robert R. & Wang, Ping, 2006. "Knowledge exchange, matching, and agglomeration," Journal of Urban Economics, Elsevier, vol. 60(1), pages 69-95, July.
    12. Roberto Ganau & Andrés Rodríguez-Pose, 2022. "Does urban concentration matter for changes in country economic performance?," Urban Studies, Urban Studies Journal Limited, vol. 59(6), pages 1275-1299, May.
    13. Duranton, Gilles & Puga, Diego, 2014. "The Growth of Cities," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 5, pages 781-853, Elsevier.
    14. Martin, Philippe & Mayer, Thierry & Mayneris, Florian, 2011. "Spatial concentration and plant-level productivity in France," Journal of Urban Economics, Elsevier, vol. 69(2), pages 182-195, March.
    15. Xiwei Zhu & Ye Liu & Ming He & Deming Luo & Yiyun Wu, 2019. "Entrepreneurship and industrial clusters: evidence from China industrial census," Small Business Economics, Springer, vol. 52(3), pages 595-616, March.
    16. Shivaram V. Devarakonda & Brian T. McCann & Jeffrey J. Reuer, 2018. "Marshallian Forces and Governance Externalities: Location Effects on Contractual Safeguards in Research and Development Alliances," Organization Science, INFORMS, vol. 29(6), pages 1112-1129, December.
    17. Marco-Lajara, Bartolomé & Zaragoza-Sáez, Patrocinio del Carmen & Claver-Cortés, Enrique & Úbeda-García, Mercedes, 2016. "Knowledge sources, agglomeration, and hotel performance," Journal of Business Research, Elsevier, vol. 69(11), pages 4856-4861.
    18. Hausmann, Ricardo & Neffke, Frank M.H., 2019. "The workforce of pioneer plants," Research Policy, Elsevier, vol. 48(3), pages 628-648.
    19. Wonsang Ryu & Thomas H. Brush & Joonhyung Bae, 2023. "How agglomeration affects alliance governance and innovation performance: The role of cluster size," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(1), pages 297-310, January.
    20. Sarah A. Low & Jason P. Brown, 2017. "Manufacturing Plant Survival in a Period of Decline," Growth and Change, Wiley Blackwell, vol. 48(3), pages 297-312, September.

    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:eee:jbrese:v:69:y:2016:i:5:p:1874-1879. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbusres .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.