Industrial Relocation Policy and Heterogeneous Plants Sorted by Productivity: Evidence from Japan
Toshihiro Okubo () and
Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)
In an economic geography model with firm heterogeneity, Baldwin and Okubo (2006) show that regional policies for promoting periphery development attract low-productivity firms and adversely affect the productivity gap within a country. This paper empirically examines their theoretical prediction by using plant-level data during active relocation policies in Japan. Our estimation results from plant-level regressions and propensity-score matching that are generally consistent with the theory. Compared to other regions, those targeted by policies, especially by industrial relocation subsidy programs, tend to have low-productivity plants.
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Working Paper: Industrial relocation policy and heterogeneous plants sorted by productivity: Evidence from Japan (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eti:dpaper:10016
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