Template-Type: ReDIF-Paper 1.0
Author-Name: George Deltas
Author-Name-First: George
Author-Name-Last: Deltas
Author-Name: Dakshina De Silva
Author-Name-First: Dakshina
Author-Name-Last: De Silva
Author-Name: Robert P. McComb
Author-Name-First: Robert P.
Author-Name-Last: McComb
Title: Industrial agglomeration and spatial persistence of employment in software publishing
Abstract: We use geocoded administrative establishment data in Texas to estimate the effects of localization economies on the spatial persistence of industrial employment in the software industry. The choice of the software industry allows us to distinguish between the spatial persistence of employment due to human capital spillovers from that due to the labor pool channel. Unlike previous research, this analysis is independent of administrative boundaries. The results suggest that a location, defined as a 1-mile radius circle, with an initial concentration of software industry employment, retains a disproportionate number of employees 6 years later despite significant job turnover. Software industry employment in surrounding areas has small effects. The results are not driven by higher establishment growth rates in high concentration locations or by differences in survival probabilities. They are fully explained by: (i) the retention by other establishments in a location of jobs lost by an establishment in that location, and (ii) an increased propensity of software establishments to enter in or near locations with prior software establishment presence. The entry effect diminishes sharply beyond one mile. We demonstrate that these findings are most consistent with labor channel effects, although the presence of human capital spillovers cannot be fully excluded.
Creation-Date: 2015
File-URL: http://www.lancaster.ac.uk/media/lancaster-university/content-assets/documents/lums/economics/working-papers/LancasterWP2015_015.pdf
File-Format: application/pdf
Number: 85393182
Classification-JEL: R12
Keywords: agglomeration economies, labor pools, knowledge spillovers, firm growth
Handle: RePEc:lan:wpaper:85393182