Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/282492 
Year of Publication: 
2023
Series/Report no.: 
CESifo Working Paper No. 10804
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Using firm-level data from France, we document that the shift of economic activity from manufacturing to services over the last few decades has been urban-biased: structural change has been more pronounced in areas with higher population density. This bias can be accounted for by the location choices of large services firms that sort into big cities and large manufacturing firms that increasingly locate in suburban and rural areas. Motivated by these findings, we estimate a structural model of city formation with heterogeneous firms and international trade. We find that agglomeration economies have strengthened for services but weakened for manufacturing. This divergence is a key driver of the urban bias but it dampens aggregate structural change. Rising manufacturing productivity and falling international trade costs further contribute to the growth of large services firms in the densest urban areas, boosting services productivity and services exports, but also land prices.
Subjects: 
agglomeration
cities
export
firm sorting
manufacturing
productivity
services
trade costs
JEL: 
F15
F61
R12
R14
Document Type: 
Working Paper
Appears in Collections:

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.