Firm exit and spatial agglomeration. Evidence on the resilience of Italian provinces

Giulio Cainelli, Sandro Montresor () and Giuseppe Vittucci Marzetti

No 1021, Openloc Working Papers from Public policies and local development

Abstract: The paper investigates the effect of spatial agglomeration on firm exit. In particular, the role of specialization and local variety in production is addressed. The extent to which industrial clusters can be actually retained industrial districts is also considered. Empirical evidence is provided for a large panel of Italian provinces and manufacturing sectors over the period 1995-2007. Urbanization economies significantly diminish firm exit of industries at the local level. Specialization also does, but only up to a certain level. Firm exit is also reduced by industrial variety, even far from the local specialization core. Industrial districts, instead, are neither less nor more resilient to industrial dynamics, unless variety is controlled for.

Keywords: Firm exit; Firm survival; Industrial districts; Spatial agglomeration; Related variety; Unrelated variety (search for similar items in EconPapers)
JEL-codes: G20 L11 R11 R12 (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:trn:utwpol:1021

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