Regional Industrial Structure and Agglomeration Economies: An Analysis of Productivity in Three Manufacturing Industries
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چکیده
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.
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