How industries migrate when agglomeration economies are important
Article Abstract:
A theory was developed to challenge assertions in earlier studies that historical accidents can bring economies into inefficient equilibria. This analysis was performed to demonstrate that historical accidents may be less influential than extant literature implies. The theory presents how economic agents in an inferior location or standard might transfer to the superior location or standard. It proposes a model in which economic agents place varying levels of importance on their proximity to other agents, with some cherishing agglomeration benefits and some not. This model has two locations. One offers better industrial production opportunity although the industry is originally located in the other due to historical accident. Agglomeration benefits are achieved from concentrating industry in one location since it allows the emergence of varied local suppliers. The lowest-tier products are the first to remove when the industry migrates.
Publication Name: Journal of Urban Economics
Subject: Government
ISSN: 0094-1190
Year: 1999
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Agglomeration economies as manifested in technical efficiency at the firm level
Article Abstract:
A study examined the significance of agglomeration economies in two Indian industries, the electrical machinery sector and the cotton and cotton textiles sector. This research used firm level data collected by the Centre for Monitoring the Indian Economy for 1992 and 1993 to explore the impact of the size of the city on the firm-specific efficiency index derived from a statistical stochastic frontier model. Findings revealed a positive relationship between technical efficiency and city size although city size becomes more of diseconomies than economies of scale after a certain level is reached. Findings indicate that undue resistance to invest in big cities may prevent firms from efficiently using resources. However, immoderate concentration in very large cities would undermine the efficiency of firms, due to the lack of an effective locational policy
Publication Name: Journal of Urban Economics
Subject: Government
ISSN: 0094-1190
Year: 1999
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Economies of scale and input substitution in public libraries
Article Abstract:
The economies of scale and input substitution elasticities of 194 public libraries in Indiana for 1988 were measured using a translog cost function. It was shown that economies of scale is possible with small public libraries, those with book circulations of less than 55,000 annually, but not with big ones whose circulations are from betwen 55,000 and 200,000. It was suggested that merging small public districts could minimize expenditures. The study also found positive Allen elasticities of substitution, thus establishing that labor, books, and supplies/services were substitutes with inflexible own-price and cross-price elasticities.
Publication Name: Journal of Urban Economics
Subject: Government
ISSN: 0094-1190
Year: 1992
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