The Impact of Globalization on Agglomeration: The Case of U.S. Manufacturing Employment from 1988 to 2003

39 Pages Posted: 3 Sep 2010  

Mark Rider

Georgia State University - Department of Economics

Abdullah M. Khan

Georgia State University

Multiple version iconThere are 2 versions of this paper

Date Written: August 1, 2010

Abstract

This paper explores the impact of globalization on the micro-determinants of agglomeration, namely labor pooling (LP), goods pooling (GP), and idea pooling (IP). According to our estimates, LP now has a negative effect on employment agglomeration in U.S. manufacturing. More specifically, we find that trade liberalization is increasing the marginal effect of LP on employment agglomeration in U.S. manufacturing, but this positive effect is overwhelmed by the large negative effect of the ICT revolution. We also find that the ICT revolution is having substantial positive effect on the marginal effect of GP on employment agglomeration in U.S. manufacturing; whereas, trade liberalization has a negligible effect on the marginal effect of GP on employment agglomeration. Finally, we report evidence that internal economies of scale have a substantial effect on employment agglomeration in U.S. manufacturing.

Keywords: Agglomeration, Globalization

JEL Classification: L60, R12

Suggested Citation

Rider, Mark and Khan, Abdullah M., The Impact of Globalization on Agglomeration: The Case of U.S. Manufacturing Employment from 1988 to 2003 (August 1, 2010). Andrew Young School of Policy Studies Research Paper Series No. 10-07. Available at SSRN: https://ssrn.com/abstract=1670211 or http://dx.doi.org/10.2139/ssrn.1670211

Mark Rider (Contact Author)

Georgia State University - Department of Economics ( email )

35 Broad Street
Atlanta, GA 30303-3083
United States

Abdullah M. Khan

Georgia State University ( email )

35 Broad Street
Atlanta, GA 30303-3083
United States

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