IDEAS home Printed from https://ideas.repec.org/p/cep/sercdp/0078.html
   My bibliography  Save this paper

Investigating Agglomeration Economies in a Panel of European Cities and Regions

Author

Listed:
  • Michael Artis
  • Declan Curran
  • Marianne Sensier

Abstract

This paper investigates agglomeration economies in an annual panel of NUTS 2 and NUTS 3 city regions across France, Germany, Ireland, Italy, Spain and the UK over 1980-2006 and comparing three sub-samples to see if the effects have changed over time. We uncover evidence of long run agglomeration effects of around 6% for NUTS 2 and NUTS 3 city regions for the full sample. The underlying pattern that this data reflects is changing sectoral composition in which manufacturing was declining, to be largely replaced by services; then more recently a period of city-based economic growth with the financial and business services-led boom at its heart.

Suggested Citation

  • Michael Artis & Declan Curran & Marianne Sensier, 2011. "Investigating Agglomeration Economies in a Panel of European Cities and Regions," SERC Discussion Papers 0078, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:sercdp:0078
    as

    Download full text from publisher

    File URL: http://cep.lse.ac.uk/pubs/download/sercdp0078.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Ciccone, Antonio & Hall, Robert E, 1996. "Productivity and the Density of Economic Activity," American Economic Review, American Economic Association, vol. 86(1), pages 54-70, March.
    2. Ciccone, Antonio, 2002. "Agglomeration effects in Europe," European Economic Review, Elsevier, vol. 46(2), pages 213-227, February.
    3. Rafael E. De Hoyos & Vasilis Sarafidis, 2006. "Testing for cross-sectional dependence in panel-data models," Stata Journal, StataCorp LP, vol. 6(4), pages 482-496, December.
    4. Rice, Patricia & Venables, Anthony J. & Patacchini, Eleonora, 2006. "Spatial determinants of productivity: Analysis for the regions of Great Britain," Regional Science and Urban Economics, Elsevier, vol. 36(6), pages 727-752, November.
    5. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
    6. Eleonora Patacchini & Patricia Rice, 2007. "Geography and Economic Performance: Exploratory Spatial Data Analysis for Great Britain," Regional Studies, Taylor & Francis Journals, vol. 41(4), pages 489-508.
    7. Anders Malmberg & Bo Malmberg & Per Lundequist, 2000. "Agglomeration and Firm Performance: Economies of Scale, Localisation, and Urbanisation among Swedish Export Firms," Environment and Planning A, , vol. 32(2), pages 305-321, February.
    8. Michael Artis & Ernest Miguélez & Rosina Moreno, 2009. "Assessing Agglomeration Economies in a Spatial Framework with Endogenous Regressors," SERC Discussion Papers 0023, Centre for Economic Performance, LSE.
    9. Leon Oerlemans & Marius Meeus, 2005. "Do Organizational and Spatial Proximity Impact on Firm Performance?," Regional Studies, Taylor & Francis Journals, vol. 39(1), pages 89-104.
    10. Brülhart, Marius & Mathys, Nicole A., 2008. "Sectoral agglomeration economies in a panel of European regions," Regional Science and Urban Economics, Elsevier, vol. 38(4), pages 348-362, July.
    11. M. Hashem Pesaran, 2021. "General diagnostic tests for cross-sectional dependence in panels," Empirical Economics, Springer, vol. 60(1), pages 13-50, January.
    12. K. J. Arrow, 1971. "The Economic Implications of Learning by Doing," Palgrave Macmillan Books, in: F. H. Hahn (ed.), Readings in the Theory of Growth, chapter 11, pages 131-149, Palgrave Macmillan.
    13. Melo, Patricia C. & Graham, Daniel J. & Noland, Robert B., 2009. "A meta-analysis of estimates of urban agglomeration economies," Regional Science and Urban Economics, Elsevier, vol. 39(3), pages 332-342, May.
    14. Wheeler, Christopher H, 2001. "Search, Sorting, and Urban Agglomeration," Journal of Labor Economics, University of Chicago Press, vol. 19(4), pages 879-899, October.
    15. Federico Cingano & Fabiano Schivardi, 2004. "Identifying the Sources of Local Productivity Growth," Journal of the European Economic Association, MIT Press, vol. 2(4), pages 720-742, June.
    16. Ron Boschma, 2005. "Proximity and Innovation: A Critical Assessment," Regional Studies, Taylor & Francis Journals, vol. 39(1), pages 61-74.
    17. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    18. Ian R. Gordon & Philip McCann, 2000. "Industrial Clusters: Complexes, Agglomeration and/or Social Networks?," Urban Studies, Urban Studies Journal Limited, vol. 37(3), pages 513-532, March.
    19. Bennett Harrison, 2007. "Industrial Districts: Old Wine in New Bottles? (Volume 26, Number 5, 1992)," Regional Studies, Taylor & Francis Journals, vol. 41(sup1), pages 107-121.
    20. Chris Van Egeraat & David Jacobson, 2006. "The Geography Of Production Linkages In The Irish And Scottish Microcomputer Industry: The Role Of Information Exchange," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 97(4), pages 405-417, September.
    21. Windmeijer, Frank, 2005. "A finite sample correction for the variance of linear efficient two-step GMM estimators," Journal of Econometrics, Elsevier, vol. 126(1), pages 25-51, May.
    22. John B Parr, 2002. "Agglomeration Economies: Ambiguities and Confusions," Environment and Planning A, , vol. 34(4), pages 717-731, April.
    23. Romer, Paul M, 1987. "Growth Based on Increasing Returns Due to Specialization," American Economic Review, American Economic Association, vol. 77(2), pages 56-62, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ferhan Gezici & Burçin Yazgı & Sinem Metin, 2013. "Analyzing the determinants of agglomeration for the manufacturing industry in Turkey," ERSA conference papers ersa13p808, European Regional Science Association.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Brülhart, Marius & Mathys, Nicole A., 2008. "Sectoral agglomeration economies in a panel of European regions," Regional Science and Urban Economics, Elsevier, vol. 38(4), pages 348-362, July.
    2. Ahlfeldt, Gabriel M. & Pietrostefani, Elisabetta, 2019. "The economic effects of density: A synthesis," Journal of Urban Economics, Elsevier, vol. 111(C), pages 93-107.
    3. Martin Andersson & Hans Lööf, 2011. "Agglomeration and productivity: evidence from firm-level data," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 46(3), pages 601-620, June.
    4. Combes, Pierre-Philippe & Gobillon, Laurent, 2015. "The Empirics of Agglomeration Economies," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 247-348, Elsevier.
    5. Graham, Daniel J. & Gibbons, Stephen, 2019. "Quantifying Wider Economic Impacts of agglomeration for transport appraisal: Existing evidence and future directions," Economics of Transportation, Elsevier, vol. 19(C), pages 1-1.
    6. Chris Egeraat & Declan Curran, 2013. "Spatial Concentration in the Irish Pharmaceutical Industry: The Role of Spatial Planning and Agglomeration Economies," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 104(3), pages 338-358, July.
    7. Benos, Nikos & Karagiannis, Stelios, 2013. "Do Cross-Section Dependence and Parameter Heterogeneity Matter? Evidence on Human Capital and Productivity in Greece," MPRA Paper 53326, University Library of Munich, Germany.
    8. Patricia C. Melo & Daniel J. Graham, 2014. "Testing for labour pooling as a source of agglomeration economies: Evidence for labour markets in England and Wales," Papers in Regional Science, Wiley Blackwell, vol. 93(1), pages 31-52, March.
    9. S. Stavropoulos & F. G. Oort & M. J. Burger, 2020. "Heterogeneous relatedness and firm productivity," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 65(2), pages 403-437, October.
    10. Daniel Graham & Kurt Dender, 2011. "Estimating the agglomeration benefits of transport investments: some tests for stability," Transportation, Springer, vol. 38(3), pages 409-426, May.
    11. Börjesson, Maria & Isacsson, Gunnar & Andersson, Matts & Anderstig, Christer, 2018. "Agglomeration, productivity and the role of transport system improvements," Working papers in Transport Economics 2018:16, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    12. Benos, Nikos & Karagiannis, Stelios, 2016. "Do education quality and spillovers matter? Evidence on human capital and productivity in Greece," Economic Modelling, Elsevier, vol. 54(C), pages 563-573.
    13. Ying Jin & Richard Bullock & Wanli Fang, 2013. "Regional Impacts of High Speed Rail in China : Spatial Proximity and Productivity in an Emerging Economy," World Bank Publications - Reports 19989, The World Bank Group.
    14. Argentino Pessoa, 2014. "Agglomeration and regional growth policy: externalities versus comparative advantages," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 53(1), pages 1-27, August.
    15. Di Addario, Sabrina & Vuri, Daniela, 2010. "Entrepreneurship and market size. The case of young college graduates in Italy," Labour Economics, Elsevier, vol. 17(5), pages 848-858, October.
    16. Emmanuel Owusu-Sekyere & Reneé van Eyden & Francis M Kemegue, 2014. "Remittances and the Dutch Disease in Sub-Saharan Africa: A Dynamic Panel Approach," Contemporary Economics, University of Economics and Human Sciences in Warsaw., vol. 8(3), September.
    17. Emmanuel Owusu-Sekyere & Francis M. Kemegue & Reneé van Eyden, 2011. "What drives remittance inflows to Sub-Saharan Africa: A Dynamic Panel Approach," Working Papers 262, Economic Research Southern Africa.
    18. Chauvin, Juan Pablo & Glaeser, Edward & Ma, Yueran & Tobio, Kristina, 2017. "What is different about urbanization in rich and poor countries? Cities in Brazil, China, India and the United States," Journal of Urban Economics, Elsevier, vol. 98(C), pages 17-49.
    19. repec:spo:wpmain:info:hdl:2441/1kv8mtgl748r0ahh12air9erdc is not listed on IDEAS
    20. Kurt Geppert & Andreas Stephan, 2008. "Regional disparities in the European Union: Convergence and agglomeration," Papers in Regional Science, Wiley Blackwell, vol. 87(2), pages 193-217, June.
    21. Graham, Daniel J. & Melo, Patricia C., 2009. "Agglomeration economies and labour productivity: evidence from longitudinal worker data for GB's travel-to-work areas," LSE Research Online Documents on Economics 33268, London School of Economics and Political Science, LSE Library.

    More about this item

    Keywords

    agglomeration; system dynamic panel data estimations;

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications
    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cep:sercdp:0078. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://cep.lse.ac.uk/_new/publications/serc-papers/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.