Abstract
If localization economies are present, fi
rms within denser industry concentrations should ex-
hibit higher levels of performance than more isolated fi
rms. Nevertheless, research in industrial organization that has focused on the inuences on fi
rm survival has largely ignored the potential effects from agglomeration. Recent studies in urban and regional economics suggests that agglomeration effcts may be very localized. Analyses of industry concentration at the MSA or
county-level may fail to detect important elements of intra-industry
rm interaction that occur at the sub-MSA level. Using a highly detailed dataset on
rm locations and characteristics for Texas, this paper analyses agglomeration effects on fi
rm survival over geographic areas as small as a single mile radius. We
nd that greater fi
rm density within very close proximity (within 1 mile) of
firms in the same industry increases mortality rates while greater concentration over larger distances reduces mortality rates.
Original language | English |
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Pages (from-to) | 691-701 |
Journal | Regional Science and Urban Economics/Elsevier |
State | Published - Oct 1 2012 |