Cities and Clusters: Economy-Wide and Sector-Specific Effects in Corporate Location

Are the observed spatial distributions of firms decided mostly by economy-wide urbanization economies or rather by sector-specific localization economies? This paper finds that the latter kind of forces weight systematically more than the former in deciding firm location. The analysis uses Italian d...

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Bibliographic Details
Published inIDEAS Working Paper Series from RePEc
Main Authors Bottazzi, Giulio, Gragnolati, Ugo
Format Paper
LanguageEnglish
Published St. Louis Federal Reserve Bank of St. Louis 01.01.2015
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Summary:Are the observed spatial distributions of firms decided mostly by economy-wide urbanization economies or rather by sector-specific localization economies? This paper finds that the latter kind of forces weight systematically more than the former in deciding firm location. The analysis uses Italian data on a variety of manufacturing and service sectors spatially disaggregated at the level of local labour market areas.