TY - JOUR
T1 - Measuring economic localization
T2 - Evidence from Japanese firm-level data
AU - Nakajima, Kentaro
AU - Saito, Yukiko Umeno
AU - Uesugi, Iichiro
N1 - Funding Information:
We would like to thank the editor (Takeo Hoshi), two anonymous referees, Tomoya Mori, Suminori Tokunaga, and participants of the JEA meeting at Senshu University and of seminars at the Bank of Japan, Hitotsubashi University, Kyoto University, RIETI, Tohoku University, the University of Tokyo, and Yokohama National University for helpful comments. We would like to thank RIETI for providing the dataset for our research. We gratefully acknowledge the support from the Program for Promoting Social Science Research Aimed at Solutions of Near-Future Problems “Design of Interfirm Network to Achieve Sustainable Economic Growth”. Nakajima gratefully acknowledges financial support from the Japan Society for the Promotion of Science (#22330073, #23730228). Saito gratefully acknowledges financial support from the Japan Society for the Promotion of Science (#22730191).
PY - 2012/6
Y1 - 2012/6
N2 - This paper examines location patterns of Japan's manufacturing industries using a unique firm-level dataset on the geographic location of firms. Following the point-pattern approach proposed by . Duranton and Overman (2005), we find the following. First, about half of Japan's manufacturing industries can be classified as localized and the number of localized industries is largest for a distance level of 40. km or less. Second, several industries in the textile mill products sector are among the most localized, which is similar to findings for the UK, suggesting that there exist common factors across countries determining the concentration of industrial activities. Third, the distribution of distances between entrant (exiting) firms and remaining firms is, in most industries, not significantly different from a random distribution. These results suggest that most industries in Japan neither become more localized nor more dispersed over time and are in line with similar findings by . Duranton and Overman (2008) for the UK. Fourth, a comparison with the service sector indicates that the share of localized industries is higher in manufacturing than in services, although the extent of localization among the most localized manufacturing industries is smaller than that among the most localized service industries, including financial service industries.
AB - This paper examines location patterns of Japan's manufacturing industries using a unique firm-level dataset on the geographic location of firms. Following the point-pattern approach proposed by . Duranton and Overman (2005), we find the following. First, about half of Japan's manufacturing industries can be classified as localized and the number of localized industries is largest for a distance level of 40. km or less. Second, several industries in the textile mill products sector are among the most localized, which is similar to findings for the UK, suggesting that there exist common factors across countries determining the concentration of industrial activities. Third, the distribution of distances between entrant (exiting) firms and remaining firms is, in most industries, not significantly different from a random distribution. These results suggest that most industries in Japan neither become more localized nor more dispersed over time and are in line with similar findings by . Duranton and Overman (2008) for the UK. Fourth, a comparison with the service sector indicates that the share of localized industries is higher in manufacturing than in services, although the extent of localization among the most localized manufacturing industries is smaller than that among the most localized service industries, including financial service industries.
KW - Economic geography
KW - Micro-geographic data
KW - Service sector
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U2 - 10.1016/j.jjie.2012.02.002
DO - 10.1016/j.jjie.2012.02.002
M3 - Article
AN - SCOPUS:84861781462
SN - 0889-1583
VL - 26
SP - 201
EP - 220
JO - Journal of The Japanese and International Economies
JF - Journal of The Japanese and International Economies
IS - 2
ER -