Labour Pooling As a Source of Agglomeration: An Empirical Investigation

Diego Puga and Henry Overman

No 7174, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We provide empirical evidence on the role of labour market pooling in determining the spatial concentration of UK manufacturing establishments. This role arises because large concentrations of employment iron out idiosyncratic shocks and improve establishments' ability to adapt their employment to good and bad times. We measure the likely importance of labour pooling by calculating the fluctuations in employment of individual establishments relative to their sector and averaging by sector. Our results show that sectors whose establishments experience more idiosyncratic volatility are more spatially concentrated, even after controlling for a range of other industry characteristics that include a novel measure of the importance of localized intermediate suppliers.

Keywords: Labour market pooling; Spatial concentration (search for similar items in EconPapers)
JEL-codes: R12 R30 (search for similar items in EconPapers)
Date: 2009-02
New Economics Papers: this item is included in nep-geo and nep-ure
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Citations: View citations in EconPapers (11)

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Related works:
Chapter: Labor Pooling as a Source of Agglomeration: An Empirical Investigation (2010)
Working Paper: Labour Pooling as a Source of Agglomeration: An Empirical Investigation (2008)
Working Paper: Labour pooling as a source of agglomeration: an empirical investigation (2008)
Working Paper: Labour pooling as a source of agglomeration: An empirical investigation (2008)
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