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- Title
Industry Concentration, Knowledge Diffusion and Economic Growth Without Scale Effects.
- Authors
Davis, Colin; Hashimoto, Ken‐Ichi
- Abstract
This paper studies the relationship between geographic patterns of industry and economic growth without scale effects. Facing transport costs and imperfect knowledge diffusion, firms locate production, process innovation and product development in their lowest cost regions, leading to the partial concentration of production and full agglomeration of innovation in the region with the largest market. An increase in industry concentration raises knowledge spillovers from production to innovation, causing a fall (rise) in market entry, if labour productivity improves more for process innovation (product development). The rate of economic growth rises or falls, depending on how industry concentration affects market entry.
- Subjects
ECONOMIC development; DEVELOPMENTAL biology; SOLUTION (Chemistry); MOLECULAR vibration; SEMICONDUCTOR doping
- Publication
Economica, 2015, Vol 82, Issue 328, p769
- ISSN
0013-0427
- Publication type
Article
- DOI
10.1111/ecca.12129