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Heterogeneous Agglomeration

Author

Listed:
  • Giulia Faggio

    (City, University of London)

  • Olmo Silva

    (London School of Economics)

  • William C. Strange

    (University of Toronto)

Abstract

Many prior treatments of agglomeration explicitly or implicitly assume that all industries agglomerate for the same reasons. This paper uses U.K. establishment-level coagglomeration data to document substantial heterogeneity across industries in the microfoundations of agglomeration economies. It finds robust evidence of organizational and adaptive agglomeration forces as discussed by Chinitz (1961), Vernon (1960), and Jacobs (1969). These forces interact with the traditional Marshallian (1890) factors of input sharing, labor pooling, and knowledge spillovers, establishing a previously unrecognized complementarity between the approaches of Marshall and Jacobs, as well as others, to the analysis of agglomeration.

Suggested Citation

  • Giulia Faggio & Olmo Silva & William C. Strange, 2017. "Heterogeneous Agglomeration," The Review of Economics and Statistics, MIT Press, vol. 99(1), pages 80-94, March.
    • Handle: RePEc:tpr:restat:v:99:y:2017:i:1:p:80-94
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    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

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