Agglomeration and sorting in U.S. manufacturing

Andrea Stella

No 2025-031, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: Using data on U.S. manufacturing plants, I estimate a production function model that includes agglomeration intensity as a component of total factor productivity and allows agglomeration benefits to vary across establishments, which can lead to sorting. I find that agglomeration benefits decline with unobserved establishment-level raw productivity.

Keywords: sorting; census of manufactures; agglomeration (search for similar items in EconPapers)
JEL-codes: D22 D24 E24 L11 R11 R32 (search for similar items in EconPapers)
Date: 2025-04-23
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfe:2025-31

DOI: 10.17016/FEDS.2025.031

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