Spatial agglomeration, global value chains, and productivity: micro-evidence from Italy and Spain

Cainelli, G., Ganau, R. & Giunta, A. (2018). Spatial agglomeration, global value chains, and productivity: micro-evidence from Italy and Spain. Economics Letters, 169, 43-46. https://doi.org/10.1016/j.econlet.2018.04.020
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We investigate the relationship between spatial agglomeration and firms’ labor productivity in Italy and Spain, examining firm-level heterogeneity in Global Value Chain positioning. We analyze a sample of 4, 025 manufacturing firms during the period from 2010 to 2014 and employ a shift-share instrumental variable approach. We find that agglomeration has a positive effect on labor productivity for suppliers but not for final firms.

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