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

Listed author(s):
  • Klein, Alexander

    (University of Kent)

  • Crafts, Nicholas

    (University of Warwick)

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.

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File URL: http://www2.warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/235-2015__klein__crafts.pdf
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Paper provided by Competitive Advantage in the Global Economy (CAGE) in its series CAGE Online Working Paper Series with number 235.

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Date of creation: 2015
Handle: RePEc:cge:wacage:235
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