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National Industry Trade Shocks, Local Labour Markets, and Agglomeration Spillovers

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  • Ines Helm

Abstract

Using a broad set of national industry trade shocks, I employ a novel approach to estimate agglomeration effects by exploiting within industry variation in indirect exposure to the other local industries' (national) trade shocks across local labour markets. This variation stems from differences in local industry composition and allows to test for the existence of heterogeneous agglomeration effects across industries. I find considerable employment spillovers from othertradable industries' trade shocks and even stronger effects within the same broad sector. Spillovers are larger for industries employing similar workers and are triggered predominantly by shocks to high-technology industries.

Suggested Citation

  • Ines Helm, 2020. "National Industry Trade Shocks, Local Labour Markets, and Agglomeration Spillovers," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 87(3), pages 1399-1431.
    • Handle: RePEc:oup:restud:v:87:y:2020:i:3:p:1399-1431.
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    More about this item

    Keywords

    Agglomeration; Local labour markets; Trade shocks;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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