The Magnitude and Causes of Agglomeration Economies

17 Pages Posted: 8 Feb 2010

See all articles by Diego Puga

Diego Puga

IMDEA Social Sciences; University of Toronto - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Date Written: 2009-09

Abstract

Firms and workers are much more productive in large and dense urban environments. There is substantial evidence of such agglomeration economies based on three approaches. First, on a clustering of production beyond what can be explained by chance or comparative advantage. Second, on spatial patterns in wages and rents. Third, on systematic variations in productivity with the urban environment. However, more needs to be learned about the causes of agglomeration economies. We have good models of agglomeration through sharing and matching, but not a deep enough understanding of learning in cities. Despite recent progress, more work is needed to distinguish empirically between alternative causes.

Suggested Citation

Puga, Diego, The Magnitude and Causes of Agglomeration Economies (2009-09). Journal of Regional Science, Vol. 50, Issue 1, pp. 203-219, February 2010, Available at SSRN: https://ssrn.com/abstract=1547414 or http://dx.doi.org/10.1111/j.1467-9787.2009.00657.x

Diego Puga (Contact Author)

IMDEA Social Sciences ( email )

Calle Veláquez 76
Madrid, 28001
Spain

University of Toronto - Department of Economics ( email )

150 St. George Street
Toronto, Ontario M5S 3G7
Canada
416-978-4375 (Phone)
416-978-6713 (Fax)

HOME PAGE: http://dpuga.economics.utoronto.ca/

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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