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Vertical Industry Linkages: Sources of Productivity Gains and Cumulative Causation?

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  • Knarvik, K.H.M.
  • Steen, F.

Abstract

In this paper we analyse vertical industry linkages and the extent to which these work as channels for externalities. First, activity based externalities stemming from output growth and output level in vertically linked industries are tested for. Second, we aim at revealing the importance of a large home market for upstream industries. Eventually, by comparing results on localised inter-industry externalities as well as significance of local sales linkages, we try to identify to what extent the geographical agglomeration of an industry is self-reinforcing. A number of Norwegian maritime transport and services sectors are analysed. The results are promising in the sense that the model distinguishes empirically between different sources of externalities, and unveils which vertical linkages that give rise to endogenous agglomeration.

Suggested Citation

  • Knarvik, K.H.M. & Steen, F., 2000. "Vertical Industry Linkages: Sources of Productivity Gains and Cumulative Causation?," Papers 1/2000, Norwegian School of Economics and Business Administration-.
    • Handle: RePEc:fth:norgee:1/2000
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    References listed on IDEAS

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    Cited by:

    1. N. Domeque Claver & C. Fillat Castej & F. Sanz Gracia, 2012. "External economies as a mechanism of agglomeration in EU manufacturing," Applied Economics, Taylor & Francis Journals, vol. 44(34), pages 4421-4438, December.
    2. Holger Görg & Aoife Hanley, 2004. "Does Outsourcing Increase Profitability?," The Economic and Social Review, Economic and Social Studies, vol. 35(3), pages 267-288.
    3. Néstor Duch, 2005. "Vertical linkages, agglomeration and the organization of production in European regions," Working Papers 2005/6, Institut d'Economia de Barcelona (IEB).
    4. Néstor Duch, 2005. "Vertical linkages, agglomeration and the organization of production in European regions," Working Papers 2005/6, Institut d'Economia de Barcelona (IEB).

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    More about this item

    Keywords

    ECONOMIC GROWTH ; PRODUCTIVITY ; ECONOMIES OF SCALE;
    All these keywords.

    JEL classification:

    • C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables
    • L8 - Industrial Organization - - Industry Studies: Services
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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