Industry Agglomeration and Investment in Rural Businesses

Todd Gabe

Review of Agricultural Economics, 2005, vol. 27, issue 1, 89-103

Abstract: This paper examines the effects of local industry agglomeration on investments in equipment and machinery by businesses located in Maine. Descriptive analysis of the data indicates that a substantial amount of the investments in nonmetropolitan counties and small towns occurred in high-agglomeration county-industries. However, econometric results imply that, while positive, the effects of agglomeration on investment are somewhat modest. Further analysis of industry-specific descriptive statistics provides mixed evidence on the connection between business investment and local industry agglomeration. These results suggest that local policymakers should proceed with caution when implementing cluster-based economic development strategies. Copyright 2005, Oxford University Press.

Date: 2005
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Journal Article: Industry Agglomeration and Investment in Rural Businesses (2005)
Working Paper: INDUSTRY AGGLOMERATION AND INVESTMENT IN RURAL BUSINESSES (2004)
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