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Spatial and supply/demand agglomeration economies: State- and industry-linkages in the U.S. food system

In: Spatial Econometrics

Author

Listed:
  • Jeffrey P. Cohen

    (Barney School of Business University of Hartford)

  • Catherine J. Morrison Paul

    (University of California)

Abstract

Cost-impacts of spatial and industrial spillovers on economic performance are evaluated by incorporating activity level measures for nearby states and related industries into a cost function model. We focus on localization and urbanization economies for state level food processing industries, from activity levels of similar industries in neighboring states, agricultural input suppliers, and final product demand. We find significant cost-savings from proximity to other food manufacturing centers, and areas with high purchasing power. Cost savings from locating near an agricultural area are also evident, although it seems costly to be located within a rural agricultural state, implying thin market diseconomies. Marginal production costs instead appear higher in more urban, and lower in more rural, areas. These spillover patterns also have input composition implications; materials demand responses are the most closely tracked by the agglomeration cost effects, and capital and labor impacts vary.

Suggested Citation

  • Jeffrey P. Cohen & Catherine J. Morrison Paul, 2009. "Spatial and supply/demand agglomeration economies: State- and industry-linkages in the U.S. food system," Studies in Empirical Economics, in: Giuseppe Arbia & Badi H. Baltagi (ed.), Spatial Econometrics, pages 263-281, Springer.
    • Handle: RePEc:spr:stecpp:978-3-7908-2070-6_14
    DOI: 10.1007/978-3-7908-2070-6_14
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    Cited by:

    1. Zhenhua Chen & Kingsley Haynes, 2015. "Multilevel assessment of public transportation infrastructure: a spatial econometric computable general equilibrium approach," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 54(3), pages 663-685, May.
    2. Zhenhua Chen & Kingsley E. Haynes, 2015. "Public surface transportation and regional output: A spatial panel approach," Papers in Regional Science, Wiley Blackwell, vol. 94(4), pages 727-751, November.
    3. Chen, Zhenhua & Haynes, Kingsley E., 2013. "Transportation Capital in the US: A Multimodal General Equilibrium Analysis," Conference papers 332323, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    4. Cohen, Jeffrey P. & Paul, Catherine J. Morrison, 2005. "Agglomeration economies and industry location decisions: the impacts of spatial and industrial spillovers," Regional Science and Urban Economics, Elsevier, vol. 35(3), pages 215-237, May.
    5. Zhenhua Chen & Kingsley E. Haynes, 2015. "Regional Impact of Public Transportation Infrastructure," Economic Development Quarterly, , vol. 29(3), pages 275-291, August.
    6. Derek G. Brewin & Daniel C. Monchuk & Mark D. Partridge, 2009. "Examining the Adoption of Product and Process Innovations in the Canadian Food Processing Industry," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 57(1), pages 75-97, March.
    7. Jean‐Pierre Huiban, 2009. "Urban versus Rural Firms: Does Location Affect Labor Demand?," Growth and Change, Wiley Blackwell, vol. 40(4), pages 649-672, December.
    8. Zhenhua Chen, 2013. "Spatial Impact of Transportation Infrastructure: A Spatial Econometric CGE Approach," ERSA conference papers ersa13p241, European Regional Science Association.
    9. Frank Asche & Kristin H. Roll & Ragnar Tveteras, 2016. "Profiting from Agglomeration? Evidence from the Salmon Aquaculture Industry," Regional Studies, Taylor & Francis Journals, vol. 50(10), pages 1742-1754, October.

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    Keywords

    Spatial; costs; food; agglomeration;
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