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Productivity, agglomeration, and diversity: A multilevel analysis of firms in ecuadorian regions

Author

Listed:
  • Juan Fernández-Sastre

    (Facultad Latinoamericana de Ciencias Sociales, FLACSO Ecuador)

  • Juan Esteban González

    (Facultad Latinoamericana de Ciencias Sociales, FLACSO Ecuador)

Abstract

This paper analyzes how territorial conditions influence the productivity of manufacturing and service firms in Ecuador. We employ multilevel models to estimate the effects of the urban population share and regional sectoral diversity on total factor productivity and labor productivity, also incorporating the moderating role of innovation. The results show that approximately 5% of the differences in productivity are attributable to geographic location. The share of urban population has a positive effect in both sectors, while sectoral diversity benefits manufacturing exclusively. Likewise, it is observed that innovative manufacturing firms enhance the benefits of both agglomeration and diversity, while service innovative firms obtain additional advantages from diversity.

Suggested Citation

  • Juan Fernández-Sastre & Juan Esteban González, 2026. "Productivity, agglomeration, and diversity: A multilevel analysis of firms in ecuadorian regions," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, vol. 66(66), pages 143-164, October.
    • Handle: RePEc:ris:invreg:023683
    DOI: 10.38191/iirr-jorr.26.003
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    Keywords

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    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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