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Productivity Differences and Agglomeration Across Districts of Great Britain

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  • Lubomira Anastassova

Abstract

This paper examines the impact of employment density (agglomeration) on the hourly earnings of workers across districts of Great Britain. The potentially two-way causality between agglomeration and productivity is dealt with using two instruments: the total land area of a district and its population density. The estimated agglomeration effect is similar across different levels of territorial aggregation; however, the effect is stronger when looking only across Metropolitan areas. There is evidence of endogeneity only when the sample is split into Metropolitan and Non-Metropolitan areas and even so endogeneity has only little effect on the estimates.

Suggested Citation

  • Lubomira Anastassova, 2006. "Productivity Differences and Agglomeration Across Districts of Great Britain," CERGE-EI Working Papers wp289, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
  • Handle: RePEc:cer:papers:wp289
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    File URL: http://www.cerge-ei.cz/pdf/wp/Wp289.pdf
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    References listed on IDEAS

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    1. Rice, Patricia & Venables, Anthony J. & Patacchini, Eleonora, 2006. "Spatial determinants of productivity: Analysis for the regions of Great Britain," Regional Science and Urban Economics, Elsevier, vol. 36(6), pages 727-752, November.
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    3. K. Newey, Whitney, 1985. "Generalized method of moments specification testing," Journal of Econometrics, Elsevier, vol. 29(3), pages 229-256, September.
    4. repec:fth:prinin:317 is not listed on IDEAS
    5. Bénédicte Vidaillet & V. D'Estaintot & P. Abécassis, 2005. "Introduction," Post-Print hal-00287137, HAL.
    6. Combes, Pierre-Philippe & Duranton, Gilles & Gobillon, Laurent, 2008. "Spatial wage disparities: Sorting matters!," Journal of Urban Economics, Elsevier, vol. 63(2), pages 723-742, March.
    7. Gilles Duranton & V Monastiriotis, 2000. "Mind the Gaps: the Evolution of Regional Inequalities in the UK, 1982-1997," CEP Discussion Papers dp0485, Centre for Economic Performance, LSE.
    8. Monastiriotis, Vassilis, 2000. "Inter- And Intra-Regional Wage Inequalities In The Uk: An Examination Of The Sources Of Uk Wage Inequalities And Their Evolution," ERSA conference papers ersa00p228, European Regional Science Association.
    9. Moomaw, Ronald L., 1985. "Firm location and city size: Reduced productivity advantages as a factor in the decline of manufacturing in urban areas," Journal of Urban Economics, Elsevier, vol. 17(1), pages 73-89, January.
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    Citations

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    Cited by:

    1. Raouf Boucekkine & David de la Croix & Dominique Peeters, 2007. "Early Literacy Achievements, Population Density, and the Transition to Modern Growth," Journal of the European Economic Association, MIT Press, vol. 5(1), pages 183-226, March.
    2. Natalia Davidson & Oleg Mariyev, 2015. "The impact of spatial concentration on enterprise performance," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(4), pages 95-105.
    3. Neil Foster & Robert Stehrer, 2009. "Sectoral Productivity, Density and Agglomeration in the Wider Europe," Spatial Economic Analysis, Taylor & Francis Journals, vol. 4(4), pages 427-446.
    4. Kutsenko, E., 2012. "Path Dependence in Spatial Distribution of Economic Activity: Bad News for Empiric Research of Agglomeration Effects," Journal of the New Economic Association, New Economic Association, vol. 14(2), pages 10-26.
    5. Davidson Natalia & Kislyak Nadezhda & Vorobyev Pavel, 2010. "Spatial Ñoncentration and Firm Performance in Russia," EERC Working Paper Series 10/05e, EERC Research Network, Russia and CIS.
    6. Charlie Karlsson & Börje Johansson & Roger R. Stough, 2012. "Introduction – Human Capital and Agglomeration," Chapters,in: The Regional Economics of Knowledge and Talent, chapter 1 Edward Elgar Publishing.

    More about this item

    Keywords

    Agglomeration; Productivity; Multiple Instruments.;

    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
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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