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Geographic concentration and the temporal scope of agglomeration economics: an index decomposition

Wren, Colin (2011) Geographic concentration and the temporal scope of agglomeration economics: an index decomposition. SERC Discussion Papers (SERCDP0094). Spatial Economics Research Centre, London School of Economics and Political Science, London, UK.

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The paper decomposes a geographical concentration index to examine the temporal scope of a spillover, which is the period of time over which one firm’s activity directly affects the location of other firms’ activities. Natural advantages are fixed over reasonably long time periods, but if spillovers have a limited temporal scope then this can be used to identify these agglomeration economies. To operationalize the index decomposition the paper proposes an empirical methodology that is based on frequency estimator approach, which is applied across time periods. The approach is tested by numerical simulation and by application to a dataset on the location of new economic activity across British regions in the form of investment by foreign-owned plants. Overall, the results support the approach and indicate that the temporal scope of a spillover is on average about five years.

Item Type: Monograph (Discussion Paper)
Official URL:
Additional Information: © 2011 The Author
Divisions: Spatial Economics Research Centre
Subjects: H Social Sciences > HC Economic History and Conditions
JEL classification: L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L10 - General
R - Urban, Rural, and Regional Economics > R1 - General Regional Economics > R12 - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade
R - Urban, Rural, and Regional Economics > R3 - Production Analysis and Firm Location > R30 - General
Date Deposited: 28 Jul 2014 12:50
Last Modified: 16 May 2024 11:56
Funders: Economic and Social Research Council, Department for Business, Innovation & Skills (BIS), Welsh Assembly Government

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