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Agglomeration effects in a developing economy: evidence from Turkey

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  • Cem Özgüzel

Abstract

I estimate the role of agglomeration economies and other local factors on productivity differences across Turkish provinces, which are some of the highest seen in OECD countries. Using a novel administrative dataset and historical instruments to deal with estimation concerns, I find that the elasticity of productivity to density is higher than in developed countries. Moreover, using an individual panel at the regional level, I find weak sorting effects for workers, contrasting with evidence from developed countries. These results suggest that urbanization patterns could be operating differently in developing countries.

Suggested Citation

  • Cem Özgüzel, 2023. "Agglomeration effects in a developing economy: evidence from Turkey," Journal of Economic Geography, Oxford University Press, vol. 23(4), pages 823-846.
  • Handle: RePEc:oup:jecgeo:v:23:y:2023:i:4:p:823-846.
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    File URL: http://hdl.handle.net/10.1093/jeg/lbac035
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    More about this item

    Keywords

    Local labor markets; spatial wage disparities; developing country; Turkey;
    All these keywords.

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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