Testing for Localization with Entropy-Based Measures

Roy Cerqueti () and Eleonora Cutrini ()
Additional contact information
Roy Cerqueti: Sapienza University of Rome
Eleonora Cutrini: University of Macerata

Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, 2024, vol. 173, issue 1, No 9, 227-247

Abstract: Abstract This paper aims to give statistical significance to the measurement of spatial concentration in the context of entropy-based approaches. We simulate confidence intervals based on a null hypothesis able to capture systematic spatial concentration of firms from random patterns, and dissimilarities between the distributions of firms and employees. We implement this two-step methodology to the European manufacturing economy, and we find a substantive spatial clustering of establishments whereby the spatial divergence between employees and firms is significant both for small-scale industries typically considered as localized because of industry-specific Marshallian external economies and for those industries characterized by considerable internal scale economies. We suggest that a high heterogeneity in firm size may have positive implications for aggregate competitiveness at the sectoral level.

Keywords: Statistical testing; Spatial concentration; Entropy measures; Confidence interval (search for similar items in EconPapers)
JEL-codes: C12 C43 C46 L60 R12 (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s11205-021-02820-6 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:soinre:v:173:y:2024:i:1:d:10.1007_s11205-021-02820-6

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/11135

DOI: 10.1007/s11205-021-02820-6

Access Statistics for this article

Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement is currently edited by Filomena Maggino

More articles in Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().