Neighborhood and Efficiency in Manufacturing in Brazilian Regions

Daniela Schettini, Carlos Azzoni and Antonio Paez

International Regional Science Review, 2011, vol. 34, issue 4, 397-418

Abstract: This paper analyzes the geography of regional competitiveness in manufacturing in Brazil. The authors estimate stochastic frontiers to calculate regional efficiency of representative firms in 137 regions in the period 2000–2006, in four sectors defined by technological intensity. The efficiency results are analyzed using Markov Spatial Transition Matrices to provide insights into the transition of regions between efficiency levels, considering their local spatial context. The results indicate that geography plays an important role in manufacturing competitiveness. In particular, regions with more competitive neighbors are more likely to improve their relative efficiency (pull effect) over time, and regions with less competitive neighbors are more likely to lose relative efficiency (drag effect). The authors find that the pull effect is stronger than the drag effect.

Keywords: spatial markov Chains; neighborhood and efficiency; manufacturing; stochastic production frontier; production function (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:inrsre:v:34:y:2011:i:4:p:397-418

DOI: 10.1177/0160017611403141

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