Marshall or Jacobs? New insights from an interaction model

Jan Kluge and Robert Lehmann

Review of Regional Research: Jahrbuch für Regionalwissenschaft, 2013, vol. 33, issue 2, 107-133

Abstract: The debate on localization and urbanization economies usually neglects interdependencies between the two types of economies. This paper addresses this problem by employing an interaction model using German data covering four different sectors for the years 1998 to 2008. We find that localization and urbanization economies interact negatively in most of the sectors. Furthermore, we study non-linear effects of specialization and diversification. Taking these into account, the signs indicating localization and urbanization economies change at certain thresholds. Our regression analysis shows evidence of localization economies in manufacturing and basic services. Urbanization economies are generally less prevalent in our data. Copyright Springer-Verlag Berlin Heidelberg 2013

Keywords: Localization and urbanization economies; Interaction models; Regional gross valued added (search for similar items in EconPapers)
Date: 2013
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Working Paper: Marshall or Jacobs? Answers to an unsuitable question from an interaction model (2012)
Working Paper: Marshall or Jacobs? Answers to an unsuitable question from an interaction model (2012)
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DOI: 10.1007/s10037-013-0076-7

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