Abstract
This chapter examines the effects of industrial agglomeration on productivity growth in emerging industries. The analysis employs four-digit data of Japanese manufacturing industries, and shows that (1) ceramic, stone, and clay products, general machinery, and precision instruments and machinery enjoy the advantage generated by proximity to other industries; (2) new manufacturing technology sectors, such as industrial robots, tend to receive agglomeration effects, although information technology sectors do not; and (3) most emerging industries do not profit from economies of scale. These findings reveal that emerging industries benefit from agglomeration effects and face market competition.
This chapter is based on Otsuka (2006) “Agglomeration economies in new growth sectors of Japanese manufacturing industry,” The Economic Review (The Keizai Kenkyuu) (Vol. 57, No. 3, pp. 224–235, in Japanese).
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Notes
- 1.
The Gini coefficient expresses the bias in locational distribution and takes a value between 0 and 1. A larger value signifies greater bias in the locational distribution and indicates the tendency for an industry to be concentrated in a specific region.
- 2.
In the analysis of listed companies by Nishimura et al. (1999), it was found that the price markup exceeded 1 in most of the manufacturing industries. Also from the analysis of Nakajima et al. (1998), who used data in the Census of Manufactures, economies of scale were observed in all manufacturing industries except textiles.
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Otsuka, A. (2017). A New Approach to Dynamic Externalities (II). In: A New Perspective on Agglomeration Economies in Japan. New Frontiers in Regional Science: Asian Perspectives, vol 20. Springer, Singapore. https://doi.org/10.1007/978-981-10-6490-6_7
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DOI: https://doi.org/10.1007/978-981-10-6490-6_7
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