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Geographic Concentration of Economic Activity: An aggregate index

  • Olga Alonso-Villar
  • Coral del Río

This paper first proposes a measure, the mutual information index derived from the information theory, to quantify overall concentration from an axiomatic perspective. The analysis reveals that this overall concentration measure can be written as the weighed sum of the Theil index for each sector of the economy (partial concentration). Next, the generalized entropy family of concentration indexes is characterized in terms of basic axioms borrowed from the literature on income distribution and occupational segregation. Finally, these measures are used to analyze the spatial patterns of manufacturing industries in Spain along the last three decades, paying special attention to their technological intensity.

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Paper provided by Universidade de Vigo, Departamento de Economía Aplicada in its series Working Papers with number 0901.

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Length: 37 pages
Date of creation: Mar 2009
Date of revision:
Handle: RePEc:vig:wpaper:0901
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Web page: http://webx06.webs.uvigo.es/
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  1. Ana Muñiz & Antonio Raya & Carmen Carvajal, 2010. "Spanish and European innovation diffusion: a structural hole approach in the input–output field," The Annals of Regional Science, Springer, vol. 44(1), pages 147-165, February.
  2. Cutrini, Eleonora, 2009. "Using entropy measures to disentangle regional from national localization patterns," Regional Science and Urban Economics, Elsevier, vol. 39(2), pages 243-250, March.
  3. Frankel, David M. & Volij, Oscar, 2007. "Measuring Segregation," Staff General Research Papers 12818, Iowa State University, Department of Economics.
  4. Jens Suedekum, 2006. "Concentration and Specialization Trends in Germany since Re-unification," Regional Studies, Taylor & Francis Journals, vol. 40(8), pages 861-873.
  5. Coral del Río & Olga Alonso-Villar, 2007. "An alternative proposal for measuring occupational segregation," Working Papers 82, ECINEQ, Society for the Study of Economic Inequality.
  6. Eleonora Cutrini, 2010. "Specialization and Concentration from a Twofold Geographical Perspective: Evidence from Europe," Regional Studies, Taylor & Francis Journals, vol. 44(3), pages 315-336.
  7. Joeri Gorter & Albert van der Horst & S. Brakman & H.F.L. Garretsen & M. Schram, 2005. "New economic geography, empirics, and regional policy," CPB Special Publication 56, CPB Netherlands Bureau for Economic Policy Analysis.
  8. Paulo Guimar�es & Octávio Figueiredo & Douglas Woodward, 2007. "Measuring The Localization Of Economic Activity: A Parametric Approach," Journal of Regional Science, Wiley Blackwell, vol. 47(4), pages 753-774.
  9. Haaland, Jan I. & Kind, Hans Jarle & Ulltveit-Moe, Karen-Helene, 1999. "What Determines the Economic Geography of Europe?," CEPR Discussion Papers 2072, C.E.P.R. Discussion Papers.
  10. Olga Alonso-Villar & Jose-MarIa Chamorro-Rivas & Xulia Gonzalez-Cerdeira, 2004. "Agglomeration economies in manufacturing industries: the case of Spain," Applied Economics, Taylor & Francis Journals, vol. 36(18), pages 2103-2116.
  11. Karl Aiginger & Michael Pfaffermayr, 2004. "The Single Market and Geographic Concentration in Europe," Review of International Economics, Wiley Blackwell, vol. 12(1), pages 1-11, 02.
  12. Silber, Jacques, 1992. "Occupational Segregation Indices in the Multidimensional Case: A Note," The Economic Record, The Economic Society of Australia, vol. 68(202), pages 276-77, September.
  13. Rui Baptista & Joana Mendonça, 2010. "Proximity to knowledge sources and the location of knowledge-based start-ups," The Annals of Regional Science, Springer, vol. 45(1), pages 5-29, August.
  14. Karl Aiginger & Stephen W. Davies, 2004. "Industrial specialisation and geographic concentration: Two sides of the same coin? Not for the European Union," Journal of Applied Economics, Universidad del CEMA, vol. 0, pages 231-248, November.
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