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Market Size, Linkages, and Productivity: A Study Of Japanese Regions

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  • David E. Weinstein
  • Donald Davis

Abstract

One account of spatial concentration focuses on productivity advantages arising from market size. We investigate this for 40 regions of Japan. Our results identify important effects of a region's own size, as well as cost linkages between producers and suppliers of inputs. Productivity links to a more general form of 'market potential' or Marshall-Arrow-Romer externalities do not appear to be robust in our data. The effects we identify are economically quite important, accounting for a substantial portion of cross-regional productivity differences.

Suggested Citation

  • David E. Weinstein & Donald Davis, 2003. "Market Size, Linkages, and Productivity: A Study Of Japanese Regions," WIDER Working Paper Series DP2003-53, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:dp2003-53
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    File URL: https://www.wider.unu.edu/sites/default/files/dp2003-053.pdf
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    References listed on IDEAS

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    6. Edward L. Glaeser & Joshua D. Gottlieb, 2009. "The Wealth of Cities: Agglomeration Economies and Spatial Equilibrium in the United States," Journal of Economic Literature, American Economic Association, vol. 47(4), pages 983-1028, December.
    7. Ben Gardiner & Ron Martin & Tyler Peter, 2004. "Competitiveness, Productivity and Economic Growth across the European Regions," ERSA conference papers ersa04p333, European Regional Science Association.
    8. Ahlfeldt, Gabriel M. & Pietrostefani, Elisabetta, 2019. "The economic effects of density: A synthesis," Journal of Urban Economics, Elsevier, vol. 111(C), pages 93-107.
    9. 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.
    10. Masayuki Morikawa, 2011. "Economies of Density and Productivity in Service Industries: An Analysis of Personal Service Industries Based on Establishment-Level Data," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 179-192, February.
    11. Luc Christiaensen & Lionel Demery & Stefano Paternostro, 2003. "Reforms, Remoteness and Risk in Africa: Understanding Inequality and Poverty during the 1990s," WIDER Working Paper Series DP2003-70, World Institute for Development Economic Research (UNU-WIDER).

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    More about this item

    Keywords

    Gross national product; Productivity; Regional economics;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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