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Regional industrial structure and agglomeration economies: An analysis of productivity in three manufacturing industries

  • Drucker, Joshua
  • Feser, Edward
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    We investigate whether a more concentrated regional industrial structure – the dominance of a few large firms in a given industry in a region – limits agglomeration economies and ultimately diminishes the economic performance of firms in that industry, especially small ones. In an application to three industries using establishment-level production functions and a combination of confidential and publicly available data sources, we find a consistently negative and substantial direct productivity effect associated with regional industrial structure concentration and only mixed and relatively weak evidence that agglomeration economies are a mediating factor in that effect.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0166046211000573
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    Article provided by Elsevier in its journal Regional Science and Urban Economics.

    Volume (Year): 42 (2012)
    Issue (Month): 1-2 ()
    Pages: 1-14

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    Handle: RePEc:eee:regeco:v:42:y:2012:i:1:p:1-14
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