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Cities and clusters: economy-wide and sector-specific effects in corporate location


  • Giulio Bottazzi
  • Ugo Gragnolati


Are the observed spatial distributions of firms decided mostly by market-mediated, economy-wide locational forces, or rather by non-pecuniary, sector-specific ones? This work finds that the latter kind of forces weight systematically more than the former in deciding firm location. The analysis uses Italian data on a variety of manufacturing and service sectors spatially disaggregated at the level of Local Labor Systems.

Suggested Citation

  • Giulio Bottazzi & Ugo Gragnolati, 2010. "Cities and clusters: economy-wide and sector-specific effects in corporate location," LEM Papers Series 2010/16, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  • Handle: RePEc:ssa:lemwps:2010/16

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    Cited by:

    1. Giulio Bottazzi & Fabio Vanni, 2014. "A numerical estimation method for discrete choice models with non-linear externalities," LEM Papers Series 2014/01, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    2. Giulio Bottazzi & Ugo M. Gragnolati & Fabio Vanni, 2017. "Non-linear externalities in firm localization," Regional Studies, Taylor & Francis Journals, vol. 51(8), pages 1138-1150, August.
    3. Thomas Brenner, 2017. "Identification of Clusters - An Actor based Approach," Working Papers on Innovation and Space 2017-02, Philipps University Marburg, Department of Geography.

    More about this item


    Industrial Location; Sector-specific Agglomeration; Urbanization Economy; Maximum Likelihood Estimation;

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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