Local Productivity Spillovers

Nathaniel Baum-Snow, Nicolas Gendron-Carrier and Ronni Pavan

American Economic Review, 2024, vol. 114, issue 4, 1030-69

Abstract: Using Canadian administrative data, this paper presents evidence of revenue and productivity spillovers across firms at fine spatial scales. Accounting for the endogenous sorting of firms across space, we estimate an average elasticity of firm revenue and productivity with respect to the average quality of other firms within 75 meters of 0.024. We find scant evidence that the average firm benefits from being surrounded by a greater amount of economic activity at this spatial scale. Sorting of higher-quality firms into more productive locations and higher average and aggregate quality peer groups is salient in the data.

JEL-codes: D22 D24 G32 L25 R11 R32 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1257/aer.20211589

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