Competitors, Complementors, Parents and Place: Explaining Regional Agglomeration in the U.S. Auto Industry
Xu, Daniel Yi
|local externalities; employee spinouts; industry agglomeration
|Taking the early U.S. automobile industry as an example, we evaluate four competing hypotheses on regional industry agglomeration: intra-industry local externalities, inter-industry local externalities, employee spinouts, and location fixed-effects. Our findings suggest that inter-industry spillovers, particularly the development of the carriage and wagon industry, play an important role. Spinouts play a secondary role and only contribute to agglomeration at later stages of industry evolution. The presence of other firms in the same industry has a negligible (or maybe even negative) effect on agglomeration. Finally, location fixed-effects account for some agglomeration, though to a lesser extent than inter-industry spillovers and spinouts.
|Copyright Cabral, Wang, and Xu, April 2013.
|Appears in Collections:
|Economics Working Papers
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|Explaining Regional Agglomeration in the U.S. Auto Industry
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