Local Productivity Advantages

In this document, there are addressed several questions concerning these two spatial concentration patterns with regard to the Italian economy: Are plants located in urban areas and industrial districts more productive than firms located elsewhere? Are the local productive advantages in the two spatially concentrated areas comparable in magnitude? How have these advantages changed in recent years? Spatial concentration may generate local productivity advantages through different mechanisms. Valter Di Giacinta belongs to the bank of Italia writes many reports, like "Hedonic value of Italian tourism supply: comparing environmental and cultural attractiveness,". This report intended to provide a thorough knowledge of the inefficiencies to be addressed,

The empirical analysis presented in the document was conducted by a large panel of approximately 29,000 Italian manufacturing firms (not plants), observed over the period 1995-2006, and constructed as follows. One of the main results of the analysis of the authors is that firms located in urban areas outperformed those located in industrial districts in terms of productivity advantages. As a first step towards identifying the factors that may explain this finding, in this section we provide additional evidence for the evolution of the local productivity advantages, the role of the skill composition of the labor force and, finally, a quantile regression analysis of the data. In the document it was investigated the issue of local productivity advantages, using data on 29,000 Italian manufacturing firms over an observation period of 12 years (1995-2006). On the whole, the analysis suggests that spatial concentration exerts favorable effects on local productivity. The estimated coefficients for the urban areas and industrial districts dummies are both positive and significant. However, locating in an urban area is generally more beneficial than in an industrial

It gives the data based on Italian national account data separating the geo-economically and the size of the enterprising. Section 5 reports the TFP estimation. Then it analyses the impact of spatial concentration on firms' TFP. Also the difference is happened in the firm located in different part of Italy and the size of the firms. In Section 7 several extensions to the baseline results are proposed including the effects of human capital heterogeneity on firms' productivity. It mainly explains the possible reasons for the data in the section 6. Agglomeration economies, selection and sorting these three forces shape the TFP distribution in urban areas and industrial districts Finally, it concludes that spatial concentration exerts favorable effects on local productivity. However, locating in an urban area is generally more beneficial than in an industrial district industrial districts. Generate local productivity advantages that can be more effectively appropriated by less efficient firms, while the externalities arising within cities can be better exploited by more efficient enterprises. Comparative advantages of urban areas remain stable while those of industrial districts show a tendency to decline over