Estimating Verdoorn law for Italian firms and regions

Giorgio Fazio, Enza Maltese and Davide Piacentino

MPRA Paper from University Library of Munich, Germany

Abstract: In empirical regional economics, returns to scale are typically estimated at the regional level in search for evidence on alternative theories of growth and agglomeration. However, returns to scale may also have a firm-level dimension. In this paper, we exploit micro level data and estimate the dynamic Verdoorn law in a multilevel-setting, where returns to scale are obtained simultaneously for the micro and the regional level. Using Italian firm-level data and the NUTS-3 level of aggregation, we estimate the classic and augmented versions of Verdoorn law for all sectors and separately for manufacturing. Our results show that increasing returns to scale co-exist at both levels, with some degree of regional heterogeneity across the Italian peninsula.

Keywords: Returns to scale; Verdoorn Law; Multilevel models; Italian firms (search for similar items in EconPapers)
JEL-codes: C31 O47 R11 R12 (search for similar items in EconPapers)
Date: 2011-12
New Economics Papers: this item is included in nep-eff, nep-eur, nep-geo and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Estimating Verdoorn law for Italian firms and regions (2013)
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