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Title:Market size, linkages and productivity: A study of Japanese regions PDF Logo
Authors:Davis, Donald R.
Weinstein, David E.
Issue Date:2003
Series/Report no.:WIDER Discussion Papers // World Institute for Development Economics (UNU-WIDER) 2003/53
Abstract:One account of spatial concentration focuses on productivity advantages arising from market size. We investigate this for 40 regions of Japan. Our results identify important effects of a region’s own size, as well as cost linkages between producers and suppliers of inputs. Productivity links to a more general form of ‘market potential’ or Marshall-Arrow- Romer externalities do not appear to be robust in our data. The effects we identify are economically quite important, accounting for a substantial portion of cross-regional productivity differences. A simple counterfactual shows that if economic activity were spread evenly over the 40 regions of Japan, aggregate output would fall by 5 percent. – markets ; regions ; productivity
JEL:D2
R0
R3
Document Type:Working Paper
Appears in Collections:WIDER Discussion Papers, United Nations University (UNU)

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