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The Impact of Regional and Sectoral Productivity Changes on the U.S. Economy

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  • Lorenzo Caliendo
  • Fernando Parro
  • Esteban Rossi-Hansberg
  • Pierre-Daniel Sarte

Abstract

We study the impact of intersectoral and interregional trade linkages in propagating disaggregated productivity changes to the rest of the economy. Using regional and industry data we obtain the aggregate, regional and sectoral elasticities of measured TFP, GDP, and employment to regional and sectoral productivity changes. We find that the elasticities vary significantly depending on the sectors and regions affected and are importantly determined by the spatial structure of the economy. We use these elasticities to perform a variety of counterfactual exercises including a detailed study of the effects of the boom in the Computers and Electronics industry in California.

Suggested Citation

  • Lorenzo Caliendo & Fernando Parro & Esteban Rossi-Hansberg & Pierre-Daniel Sarte, 2014. "The Impact of Regional and Sectoral Productivity Changes on the U.S. Economy," NBER Working Papers 20168, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:20168
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    More about this item

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • F1 - International Economics - - Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies

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