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Do Manufacturing Plants Cluster Across Rural Areas? Evidence from a Probabilistic Modeling Approach

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  • Barkley, David L.
  • Kim, Yunsoo
  • Henry, Mark S.

Abstract

A statistical procedure for detecting “contagious” location patterns for manufacturing establishments is presented. Manufacturing industries’ establishment clustering tendencies are ranked based on the “dispersion parameter” of the negative binomial distribution. Establishment data are for three-digit SIC manufacturing industries, nonmetro counties of BEA Component Economic Areas, 1981 and 1992. Findings indicate that virtually all manufacturing industries cluster establishments in nonmetro areas. Approximately two-thirds of the industries had dispersion parameters indicating a high or moderate level of spatial concentration. The propensity to cluster plants in nonmetro CEAs was evident for both 1981 and 1992, though weaker in 1992. Much of the industry clustering in nonmetro areas appears to be attributable to local “natural advantages” and not inter-firm spillovers.

Suggested Citation

  • Barkley, David L. & Kim, Yunsoo & Henry, Mark S., 2001. "Do Manufacturing Plants Cluster Across Rural Areas? Evidence from a Probabilistic Modeling Approach," UCED Research Reports 113335, Clemson University, University Center for Economic Development.
    • Handle: RePEc:ags:cucedr:113335
    DOI: 10.22004/ag.econ.113335
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    References listed on IDEAS

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    1. Ellison, Glenn & Glaeser, Edward L, 1997. "Geographic Concentration in U.S. Manufacturing Industries: A Dartboard Approach," Journal of Political Economy, University of Chicago Press, vol. 105(5), pages 889-927, October.
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    5. David L. Barkley & Mark S. Henry, 1997. "Rural Industrial Development: To Cluster or Not to Cluster?," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 19(2), pages 308-325.
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