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Agglomeration Economies in Semi-industrialized Countries: Evidence from Argentina


  • José A. Borello

    () (Instituto del Conurbano Universidad Nacional de General Sarmiento/CONICET Argentina)

  • Hernán Morhorlang

    () (Instituto de Industria Universidad Nacional de General Sarmiento Argentina)

  • Diego Silva Failde

    () (Instituto de Industria Universidad Nacional de General Sarmiento Argentina)


This paper identifies and problematizes three gaps in the existing literature on agglomeration economies. First, it argues that the ontology of agglomeration economies, the way in which these economies are conceptualized, needs to be revised. Far from being something “in the air” for all firms to profit from them, tapping these economies requires a conscious and sustained effort from firms. Second, it takes issue with the idea that the functioning of agglomeration economies in semi-industrialized countries can be read off simply from the experience of industrialized ones. Third, the paper challenges current ideas on the geographical extent of urbanization and localization economies within a metropolitan area. The empirical evidence gathered from a detailed survey of 134 manufacturing firms in the automotive and steel sectors located in the Buenos Aires Metropolitan Region (BAMR, includes the city proper and the surrounding suburbs) allows us to conclude that localization economies are not necessarily confined to neighbourhoods.

Suggested Citation

  • José A. Borello & Hernán Morhorlang & Diego Silva Failde, 2011. "Agglomeration Economies in Semi-industrialized Countries: Evidence from Argentina," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 3(3), pages 487-518, October.
  • Handle: RePEc:umk:journl:v:3:y:2011:i:3:p:487-518

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    References listed on IDEAS

    1. Kosacoff, Bernardo & Ramos, Adrián, 2006. "Microeconomic behavior in high uncertainty environments: the case of Argentina," Documentos de Proyectos 101, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    2. Rajah Rasiah, 2011. "The Role of Institutions and Linkages in Learning and Innovation," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 3(2), pages 165-172, July.
    3. Kurt Dopfer & John Foster & Jason Potts, 2004. "Micro-meso-macro," Journal of Evolutionary Economics, Springer, vol. 14(3), pages 263-279, July.
    4. Paul Krugman, 1992. "Geography and Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262610868, January.
    5. Gabriel Yoguel & Marta Novick & Anabel Marin, 2000. "Production Networks Linkages, Innovation Processes and Social Management Technologies. A Methodological Approach Applied to the Volkswagen case in Argentina," DRUID Working Papers 00-11, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    6. Sonia Roitter & Analía Erbes & Gabriel Yoguel & Marcelo Delfini & Andrea Pujol, 2007. "Competencias endógenas y vinculaciones en agentes pertenecientes a las tramas productivas automotriz y siderúrgica," Economía: teoría y práctica, Universidad Autónoma Metropolitana, México, vol. 26(1), pages 69-118, Enero-Jun.
    7. Gabriel Yoguel & Analia Erbes & Veronica Robert & Jose Borello, 2007. "Diffusion and appropriation of knowledge in different organizational structures," The Other Canon Foundation and Tallinn University of Technology Working Papers in Technology Governance and Economic Dynamics 13, TUT Ragnar Nurkse School of Innovation and Governance.
    8. Gavin A. Wood & John B. Parr, 2005. "Transaction Costs, Agglomeration Economies, and Industrial Location," Growth and Change, Wiley Blackwell, vol. 36(1), pages 1-15.
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    More about this item


    - agglomeration economies; Argentina; automotive industry; external economies; linkages; semi-industrialized countries; steel;

    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)
    • P23 - Economic Systems - - Socialist Systems and Transition Economies - - - Factor and Product Markets; Industry Studies; Population
    • P25 - Economic Systems - - Socialist Systems and Transition Economies - - - Urban, Rural, and Regional Economics


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