Regional industrial structure and agglomeration economies: An analysis of productivity in three manufacturing industries

Joshua Drucker, Edward Feser

Research output: Contribution to journalArticlepeer-review

Abstract

We investigate whether a more concentrated regional industrial structure - the dominance of a few large firms in a given industry in a region - limits agglomeration economies and ultimately diminishes the economic performance of firms in that industry, especially small ones. In an application to three industries using establishment-level production functions and a combination of confidential and publicly available data sources, we find a consistently negative and substantial direct productivity effect associated with regional industrial structure concentration and only mixed and relatively weak evidence that agglomeration economies are a mediating factor in that effect. © 2011 Elsevier B.V.
Original languageEnglish
Pages (from-to)1-14
Number of pages13
JournalRegional Science and Urban Economics
Volume42
Issue number1-2
DOIs
Publication statusPublished - Jan 2012

Keywords

  • Agglomeration economies
  • Industrial structure
  • Manufacturing
  • Productivity
  • Small firms

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