Geographic Concentration in U.S. Manufacturing Industries: A Dartboard Approach

51 Pages Posted: 16 May 2000 Last revised: 31 Jul 2001

See all articles by Glenn Ellison

Glenn Ellison

Massachusetts Institute of Technology (MIT) - Department of Economics; National Bureau of Economic Research (NBER)

Edward L. Glaeser

Harvard University - Department of Economics; Brookings Institution; National Bureau of Economic Research (NBER)

Date Written: August 1994

Abstract

This paper discusses the prevalence of Silicon Valley-style localizations of individual manufacturing industries in the United States. Several models in which firms choose locations by throwing darts at a map are used to test whether the degree of localization is greater than would be expected to arise randomly and to motivate a new index of geographic concentration. The proposed index controls for differences in the size distribution of plants and for differences in the size of the geographic areas for which data is available. As a consequence, comparisons of the degree of geographic concentration across industries can be made with more confidence. We reaffirm previous observations in finding that almost all industries are localized, although the degree of localization appears to be slight in about half of the industries in our sample. We explore the nature of agglomerative forces in describing patterns of concentration, the geographic scope of localization, and the extent to which agglomerations involve plants in similar as opposed to identical industries.

Suggested Citation

Ellison, Glenn David and Glaeser, Edward L., Geographic Concentration in U.S. Manufacturing Industries: A Dartboard Approach (August 1994). NBER Working Paper No. w4840. Available at SSRN: https://ssrn.com/abstract=227956

Glenn David Ellison (Contact Author)

Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

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Edward L. Glaeser

Harvard University - Department of Economics ( email )

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National Bureau of Economic Research (NBER)

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