Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/234754
Authors: 
Behrens, Kristian
Brown, W. Mark
Year of Publication: 
2017
Series/Report no.: 
Document de travail No. 2017-09
Abstract: 
Our objective is threefold. First, we explain how to estimate transport costs and the geographic concentration of industries using trucking microdata and geocoded plant-level data. Second, we document that transport costs explain between 25% to 57% of the observed relationship between trade and distance across Canada's economic regions. Last, we show that changes in transport costs have a substantial impact on geographic concentration patterns for vertically linked industries, depending on the strength of the links. A one standard deviation increase in transport costs leads to a 0.02 standard deviation decrease in geographic concentration for industry pairs at the bottom decile of the input-output coefficient distribution, whereas the corresponding effect at the top decile is a 0.02 standard deviation increase. This gap between weakly and strongly linked industries stands up to a wide range of specifications and is robust to instrumental variables estimations.
Subjects: 
Transport costs
trade
geographic concentration
Canada
JEL: 
R12
C23
L60
Document Type: 
Working Paper

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