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Spatial agglomeration and firm exit: a spatial dynamic analysis for Italian provinces

Author Info

  • Giulio Cainelli

    ()

    (University of Padova)

  • Sandro Montresor

    ()

    (University of Bologna)

  • Giuseppi Vittucci Marzetti

    ()

    (University of Milano - Bicocca)

Abstract

The paper investigates the effect of spatial agglomeration on firm exit in a dynamic framework. Using a large dataset at the industry-province level for Italy (1998-2007), we estimate a spatial dynamic panel model via a GMM estimator and analyze the short-run impact of specialization and variety on firm exit. Specialization negatively affects firm exit rates in the short-run. The effect is particularly significant for low-tech firms. The impact of variety on firm mortality rates at the industry level is instead less clear, although still negative and significant for low-tech firms.

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Paper provided by Dipartimento di Scienze Economiche "Marco Fanno" in its series "Marco Fanno" Working Papers with number 0173.

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Length: 27 pages
Date of creation: Oct 2013
Date of revision:
Handle: RePEc:pad:wpaper:0173
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Keywords: Firm exit; Localization; Spatial agglomeration; Specialization; Variety.;

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Find related papers by JEL classification:
  • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
  • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
  • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
  • G20 - Financial Economics - - Financial Institutions and Services - - - General

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Cited by:

  1. Anna Ferragina & Fernanda Mazzotta, 2015. "Agglomeration economies in Italy: impact on heterogeneous firms’ exit in a multilevel framework," Economia e Politica Industriale- Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 42(4), pages 395-440, December.
  2. Calá, Carla Daniela, 2014. "Regional issues on firm entry and exit in argentina: core and peripheral regions," Nülan. Deposited Documents 2023, Centro de Documentación, Facultad de Ciencias Económicas y Sociales, Universidad Nacional de Mar del Plata.
  3. Gabor Bekes & Peter Harasztosi, 2015. "Grid and shake - Spatial aggregation and robustness of regionally estimated elasticities," IEHAS Discussion Papers 1526, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
  4. Tobias Ebert & Thomas Brenner & Udo Brixy, 2015. "New Firm Survival: The Interdependence between Regional Externalities and Innovativeness," Working Papers on Innovation and Space 2015-05, Philipps University Marburg, Department of Geography.

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