IDEAS home Printed from https://ideas.repec.org/p/isu/genstf/1999010108000017642.html
   My bibliography  Save this paper

The impact of industry clustering on Iowa manufacturing wages, 1986-1994

Author

Listed:
  • Hill, Lee Edwin

Abstract

This thesis examines whether industry clustering results in higher manufacturing wages for Iowa counties. The industry for any given plant is defined to be the set of 3-digit SIC codes that use unusually large proportions of the same occupations as it's own 3-digit SIC code, as measured by key-occupation elasticities. Industry clustering is captured by measures of industry density (the number and relative size of plants in the industry) and industry size. A model is used which includes controls for workforce size (urbanization), plant size, mix of 4-digit industries, workforce education, and other relevant variables that predict county manufacturing earnings per worker. Weighted least squares regressions were performed for ten manufacturing sectors. The combined effect of industry size and industry density on manufacturing earnings is negative in half of the ten sectors.;The four sectors where clustering has the largest negative effects on wages are sectors where a significant share of rural plants serve local markets. Increases in industry size raise earnings in metals, industrial equipment and transportation equipment by a modest amount. Workforce size has a substantial positive effect on earnings in most manufacturing sectors, as does plant size. Urbanization is estimated to have the strongest effect on earnings in printing & publishing, electronics & instruments, and chemicals. The only two sectors where it has virtually no positive effect on wages are textile & leather products and meatpacking. The coefficients estimated by the model accurately predict differences between metro and non-metro counties earnings in general, but are not able to fully account for wide differences in earnings among non-metro county types.

Suggested Citation

  • Hill, Lee Edwin, 1999. "The impact of industry clustering on Iowa manufacturing wages, 1986-1994," ISU General Staff Papers 1999010108000017642, Iowa State University, Department of Economics.
    • Handle: RePEc:isu:genstf:1999010108000017642
    as

    Download full text from publisher

    File URL: https://dr.lib.iastate.edu/server/api/core/bitstreams/3eaa856b-d4a8-4421-9e61-fc0894f97010/content
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Romana Khan & Peter F. Orazem & Daniel M. Otto, 2001. "Deriving Empirical Definitions of Spatial Labor Markets: The Roles of Competing Versus Complementary Growth," Journal of Regional Science, Wiley Blackwell, vol. 41(4), pages 735-756, November.
    2. Adam B. Jaffe & Manuel Trajtenberg & Rebecca Henderson, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(3), pages 577-598.
    3. Bennett Harrison & Maryellen R. Kelley & Jon Gant, 1996. "Innovative Firm Behavior and Local Milieu: Exploring the Intersection of Agglomeration, Firm Effects, and Technological Change," Economic Geography, Taylor & Francis Journals, vol. 72(3), pages 233-258, July.
    4. Glaeser, Edward L & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1992. "Growth in Cities," Journal of Political Economy, University of Chicago Press, vol. 100(6), pages 1126-1152, December.
      • Edward L. Glaeser & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1991. "Growth in Cities," NBER Working Papers 3787, National Bureau of Economic Research, Inc.
      • Glaeser, Edward Ludwig & Kallal, Hedi D. & Scheinkman, Jose A. & Shleifer, Andrei, 1992. "Growth in Cities," Scholarly Articles 3451309, Harvard University Department of Economics.
    5. Virginia L. Carlson & Richard H. Mattoon, 1994. "Industry targeting: a new approach to local economic development," Chicago Fed Letter, Federal Reserve Bank of Chicago, issue Jan.
    6. Christopher Fawson & Dawn Thilmany & John E. Keith, 1998. "Employment Stability and the Role of Sectoral Dominance in Rural Economies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(3), pages 521-533.
    7. 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.
    8. Mark Drabenstott & Mark Henry, 1996. "A new micro view of the U.S. rural economy," Economic Review, Federal Reserve Bank of Kansas City, vol. 81(Q II), pages 53-70.
    9. Khan, Romana & Orazem, Peter & Otto, Daniel, 1998. "Deriving Empirical Definitions of Spatial Labor Markets: The Roles of Competing Vs. Complementary Growth," Staff General Research Papers Archive 1212, Iowa State University, Department of Economics.
    10. Gale, H. Frederick, Jr., 1997. "Rural Manufacturing on the Crest of the Wave: A Study of Rural-Urban Technology Use," Staff Reports 278820, United States Department of Agriculture, Economic Research Service.
    11. Henderson, Vernon & Kuncoro, Ari & Turner, Matt, 1995. "Industrial Development in Cities," Journal of Political Economy, University of Chicago Press, vol. 103(5), pages 1067-1090, October.
    12. Bernat, G. Andrew, Jr., 1994. "Manufacturing Restructuring and Rural Economies: Job Growth but Lagging Wages," Rural America/ Rural Development Perspectives, United States Department of Agriculture, Economic Research Service, vol. 9(3), June.
    13. Kusmin, Lorin, 1996. "Computer Use by Rural Workers is Rapidly Increasing," Rural America/ Rural Development Perspectives, United States Department of Agriculture, Economic Research Service, vol. 11(3), June.
    14. David L. Barkley & Mark S. Henry, 1997. "Rural Industrial Development: To Cluster or Not to Cluster?," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 19(2), pages 308-325.
    Full references (including those not matched with items on IDEAS)

    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. Georgeanne M. Artz & Younjun Kim & Peter F. Orazem, 2016. "Does Agglomeration Matter Everywhere?: New Firm Location Decisions In Rural And Urban Markets," Journal of Regional Science, Wiley Blackwell, vol. 56(1), pages 72-95, January.
    2. Todd M. Gabe, 2004. "Establishment Growth in Small Cities and Towns," International Regional Science Review, , vol. 27(2), pages 164-186, April.
    3. Berliant, Marcus & Reed III, Robert R. & Wang, Ping, 2006. "Knowledge exchange, matching, and agglomeration," Journal of Urban Economics, Elsevier, vol. 60(1), pages 69-95, July.
    4. Edward L. Glaeser, 1998. "Are Cities Dying?," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 139-160, Spring.
    5. Duranton, Gilles & Puga, Diego, 2014. "The Growth of Cities," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 5, pages 781-853, Elsevier.
    6. J. Vernon Henderson, Zmarak Shalizi, and Anthony J. Venables, 2001. "Geography and development," Journal of Economic Geography, Oxford University Press, vol. 1(1), pages 81-105, January.
    7. Stuart S. Rosenthal & William C. Strange, 2003. "Geography, Industrial Organization, and Agglomeration," The Review of Economics and Statistics, MIT Press, vol. 85(2), pages 377-393, May.
    8. Delgado, Mercedes & Porter, Michael E. & Stern, Scott, 2014. "Clusters, convergence, and economic performance," Research Policy, Elsevier, vol. 43(10), pages 1785-1799.
    9. Henry Overman & Stephen Redding & Anthony J. Venables, 2001. "The Economic Geography of Trade, Production, and Income: A Survey of Empirics," CEP Discussion Papers dp0508, Centre for Economic Performance, LSE.
    10. Gerald A. Carlino & Satyajit Chatterjee & Robert M. Hunt, 2001. "Knowledge spillovers and the new economy of cities," Working Papers 01-14, Federal Reserve Bank of Philadelphia.
    11. Koen Frenken & Frank G. van Oort & Thijs Verburg & Ron A. Boschma, 2004. "Variety and regional economic growth in the Netherlands," Papers in Evolutionary Economic Geography (PEEG) 0502, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Dec 2004.
    12. Mion, Giordano, 2004. "Spatial externalities and empirical analysis: the case of Italy," Journal of Urban Economics, Elsevier, vol. 56(1), pages 97-118, July.
    13. Henderson, J. Vernon, 2003. "Marshall's scale economies," Journal of Urban Economics, Elsevier, vol. 53(1), pages 1-28, January.
    14. 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.
    15. Brunello, Giorgio & De Paola, Maria, 2008. "Training and economic density: Some evidence form Italian provinces," Labour Economics, Elsevier, vol. 15(1), pages 118-140, February.
    16. Rita Almeida & Ana M. Fernandes, 2013. "Explaining local manufacturing growth in Chile: the advantages of sectoral diversity," Applied Economics, Taylor & Francis Journals, vol. 45(16), pages 2201-2213, June.
    17. Martin, Philippe, 1999. "Public policies, regional inequalities and growth," Journal of Public Economics, Elsevier, vol. 73(1), pages 85-105, July.
    18. Yuri Jo & Chang-Yang Lee, 2014. "Technological Capability, Agglomeration Economies and Firm Location Choice," Regional Studies, Taylor & Francis Journals, vol. 48(8), pages 1337-1352, August.
    19. Rita Almeida, 2007. "Local Economic Structure and Growth," Spatial Economic Analysis, Taylor & Francis Journals, vol. 2(1), pages 65-90.
    20. Ning, Lutao & Wang, Fan & Li, Jian, 2016. "Urban innovation, regional externalities of foreign direct investment and industrial agglomeration: Evidence from Chinese cities," Research Policy, Elsevier, vol. 45(4), pages 830-843.

    More about this item

    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:isu:genstf:1999010108000017642. 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: Curtis Balmer (email available below). General contact details of provider: https://edirc.repec.org/data/deiasus.html .

    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.