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A note on MAR and Jacobs externalities in the Tunisian manufacturing industries

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  • Mohamed Amara
  • AbdelRahmen El Lahga

Abstract

The aim of this paper is to identify the effect of neighborhood peer groups on firm’s performance, approximated by the value added per worker. More specifically, we distinguish between the effects of own firm’s characteristics (direct effects) and mean characteristics of their neighbors (endogenous and contextual effects) on its output level. Using the Conditional Maximum Likelihood estimator proposed by Lee (J Econom, 140(2):333–374, 2007 ) on Tunisian data, we show that the average value added per worker of peers affect significantly individual firm’s performance. In addition, contextual peer effects are also significant. The multiplier effect on labor productivity varies between 1.6 and 2.03 according to the reference group definition. Copyright Springer-Verlag Berlin Heidelberg 2015

Suggested Citation

  • Mohamed Amara & AbdelRahmen El Lahga, 2015. "A note on MAR and Jacobs externalities in the Tunisian manufacturing industries," Letters in Spatial and Resource Sciences, Springer, vol. 8(2), pages 151-167, July.
    • Handle: RePEc:spr:lsprsc:v:8:y:2015:i:2:p:151-167
    DOI: 10.1007/s12076-014-0121-3
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    More about this item

    Keywords

    Labor productivity; Peers effects; Endogenous effects; Contextual effects; Social networks; Tunisia; C31; J24; L14; R32;
    All these keywords.

    JEL classification:

    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • R32 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other Spatial Production and Pricing Analysis

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