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Heterogeneous agglomeration

Giulia Faggio (), Olmo Silva () and William Strange

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Many prior treatments of agglomeration explicitly or implicitly assume that all industries agglomerate for the same reasons, with the traditional Marshallian (1890) factors of input sharing, labor pooling, and knowledge spillovers affecting all industries similarly. An important instance of this approach is the extrapolation from one key sector to the larger economy, such as the drawing of very general lessons about agglomeration from the specific case of the Silicon Valley. Another is the pooling of data to examine common tendencies in agglomeration even across very different industries. This paper uses UK establishment-level data on coagglomeration to document substantial heterogeneity across industries in the microfoundations of agglomeration economies. The analysis shows that the Marshallian factors interact with the organizational and adaptive aspects of agglomeration discussed by Chinitz (1961), Vernon (1960), and Jacobs (1969). Our findings highlight the importance of treating Marshall’s microfoundations of agglomeration as complements to the analysis of Jacobs and others, rather than as alternatives.

Keywords: ES/J021342/1 (search for similar items in EconPapers)
JEL-codes: C1 J01 R14 (search for similar items in EconPapers)
Date: 2017-02-23
New Economics Papers: this item is included in nep-geo and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22) Track citations by RSS feed

Published in Review of Economics and Statistics, 23, February, 2017, 99(1), pp. 80-94. ISSN: 0034-6535

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http://eprints.lse.ac.uk/64765/ Open access version. (application/pdf)

Related works:
Journal Article: Heterogeneous Agglomeration (2017) Downloads
Working Paper: Heterogeneous Agglomeration (2014) Downloads
Working Paper: Heterogeneous agglomeration (2014) Downloads
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