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Spatial concentration and firm-level productivity in Kazakhstan

Zarina Adilkhanova ()

No 14, NAC Analytica Working Paper from NAC Analytica, Nazarbayev University

Abstract: This paper studies the effect of spatial agglomeration on firms' total factor productivity in Kazakhstan using panel data from 2009 to 2017. We employ a two-stage estimation strategy and control for endogeneity biases by making use of the GMM approach. The results suggest that productivity increases with clustering: a 10% increase in the number of employees of the neighboring firms inside the same industry increases firm-level productivity by 1.36%, while a 10% increase in the employment in other industries enhance firm performance by 1.95%. The productivity gains are higher at the 2-digit regional level rather than at the 9-digit sub-regional level of geographical aggregation, implying that the denser geography increases firms' performance more than in the observed geography.

Keywords: Agglomeration economies; Total Factor Productivity; Spatial Concentration; Clusters (search for similar items in EconPapers)
JEL-codes: C23 R10 R11 R12 R15 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2020-12, Revised 2021-04
New Economics Papers: this item is included in nep-cis, nep-eff, nep-geo, nep-sbm and nep-ure
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