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How Local are Spatial Density Externalities? Neighbourhood Effects in Agglomeration Economies

Andersson, Martin LU ; Klaesson, Johan and Larsson, Johan P. (2014) In Regional Studies
Abstract

Andersson M., Klaesson J. and Larsson J. P. How local are spatial density externalities? Neighbourhood effects in agglomeration economies, Regional Studies. The geographic scale at which density externalities operate is analysed in this paper. Using geocoded high-resolution data, the analysis is focused on exogenously determined within-city squares (‘neighbourhoods’) of 1 km2. The analysis confirms a city-wide employment density–wage elasticity and an economically significant density–wage elasticity at the neighbourhood level that attenuate sharply with distance. Panel estimates over 20 years suggest a neighbourhood density–wage elasticity of about 3%, while the city-wide elasticity is about 1%. It is argued that the... (More)

Andersson M., Klaesson J. and Larsson J. P. How local are spatial density externalities? Neighbourhood effects in agglomeration economies, Regional Studies. The geographic scale at which density externalities operate is analysed in this paper. Using geocoded high-resolution data, the analysis is focused on exogenously determined within-city squares (‘neighbourhoods’) of 1 km2. The analysis confirms a city-wide employment density–wage elasticity and an economically significant density–wage elasticity at the neighbourhood level that attenuate sharply with distance. Panel estimates over 20 years suggest a neighbourhood density–wage elasticity of about 3%, while the city-wide elasticity is about 1%. It is argued that the neighbourhood level is more prone to capture learning, e.g. through knowledge and information spillovers. This interpretation is supported by (1) significantly larger neighbourhood elasticities for university educated workers and (2) sharper attenuation with distance of the effect for such workers.

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Contribution to journal
publication status
in press
subject
keywords
Agglomeration externalities, Density, External scale economies, Geocoded data, Modifiable areal unit problem (MAUP), Productivity, Spatial dependence, Spatial scale, Sweden, Wages
in
Regional Studies
publisher
Taylor & Francis
external identifiers
  • Scopus:84908439746
ISSN
0034-3404
DOI
10.1080/00343404.2014.968119
language
English
LU publication?
yes
id
508bb23c-df22-490f-85d2-074386d6ac13
date added to LUP
2016-04-08 12:12:49
date last changed
2017-01-01 08:22:06
@article{508bb23c-df22-490f-85d2-074386d6ac13,
  abstract     = {<p>Andersson M., Klaesson J. and Larsson J. P. How local are spatial density externalities? Neighbourhood effects in agglomeration economies, Regional Studies. The geographic scale at which density externalities operate is analysed in this paper. Using geocoded high-resolution data, the analysis is focused on exogenously determined within-city squares (‘neighbourhoods’) of 1 km<sup>2</sup>. The analysis confirms a city-wide employment density–wage elasticity and an economically significant density–wage elasticity at the neighbourhood level that attenuate sharply with distance. Panel estimates over 20 years suggest a neighbourhood density–wage elasticity of about 3%, while the city-wide elasticity is about 1%. It is argued that the neighbourhood level is more prone to capture learning, e.g. through knowledge and information spillovers. This interpretation is supported by (1) significantly larger neighbourhood elasticities for university educated workers and (2) sharper attenuation with distance of the effect for such workers.</p>},
  author       = {Andersson, Martin and Klaesson, Johan and Larsson, Johan P.},
  issn         = {0034-3404},
  keyword      = {Agglomeration externalities,Density,External scale economies,Geocoded data,Modifiable areal unit problem (MAUP),Productivity,Spatial dependence,Spatial scale,Sweden,Wages},
  language     = {eng},
  month        = {11},
  publisher    = {Taylor & Francis},
  series       = {Regional Studies},
  title        = {How Local are Spatial Density Externalities? Neighbourhood Effects in Agglomeration Economies},
  url          = {http://dx.doi.org/10.1080/00343404.2014.968119},
  year         = {2014},
}