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Agglomeration Economies and Productivity Growth : U.S. Cities, 1880-1930

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Listed:
  • Klein, Alexander

    (University of Kent)

  • Crafts, Nicholas

    (University of Warwick)

Abstract

We investigate the role of industrial structure in labor productivity growth in U.S. cities between 1880 and 1930 using a new dataset constructed from the Census of Manufactures. We find that increases in specialization were associated with faster productivity growth but that diversity only had positive effects on productivity performance in large cities. We interpret our results as providing strong support for the importance of Marshallian externalities. Industrial specialization increased considerably in U.S. cities in the early 20th century, probably as a result of improved transportation, and we estimate that this resulted in significant gains in labor productivity.

Suggested Citation

  • Klein, Alexander & Crafts, Nicholas, 2015. "Agglomeration Economies and Productivity Growth : U.S. Cities, 1880-1930," CAGE Online Working Paper Series 235, Competitive Advantage in the Global Economy (CAGE).
  • Handle: RePEc:cge:wacage:235
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    References listed on IDEAS

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    More about this item

    Keywords

    agglomeration economies ; Jacobian externalities ; manufacturing productivity ; Marshallian externalities ; industrial structure JEL Classification: N91 ; N92 ; O7 ; R32;
    All these keywords.

    JEL classification:

    • N91 - Economic History - - Regional and Urban History - - - U.S.; Canada: Pre-1913
    • N92 - Economic History - - Regional and Urban History - - - U.S.; Canada: 1913-
    • 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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