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

39 Pages Posted: 27 Oct 2011 Last revised: 15 Oct 2016

See all articles by Abdullah M. Khan

Abdullah M. Khan

Claflin University School of Business

Mark Rider

Georgia State University - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: October 16, 2011

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

Khan, Abdullah M. and Rider, Mark, The Impact of Globalization on Agglomeration: The Case of U.S. Manufacturing Employment from 1988 to 2003 (October 16, 2011). Available at SSRN: https://ssrn.com/abstract=1944995 or http://dx.doi.org/10.2139/ssrn.1944995

Abdullah M. Khan

Claflin University School of Business ( email )

400 Magnolia St.
Orangeburg, SC 29115
United States

HOME PAGE: http://www.claflin.edu

Mark Rider (Contact Author)

Georgia State University - Department of Economics ( email )

35 Broad Street
Atlanta, GA 30303-3083
United States

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