Are Small Firms More Dependent on the Local Environment than Larger Firms? Evidence from Portuguese Manufacturing Firms

Carreira, Carlos; Lopes, Luís

doi:10.1007/978-3-319-12871-9_13

Cited by 4 publications

(2 citation statements)

References 32 publications

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“…First, localization economies will be measured by a location quotient, which retains the relative importance of the share of employment in the industry and in the region relative to the national levels (used, namely by Hervas‐Oliver et al, ; Liang & Goetz, ; and Mukkala, ). In our study we use localization economies (SPE), based on employment, for the industry i in region r , for each period t , that is defined as:

{SPE}_{irt} = \frac{\frac{L_{irt}}{\sum_{r} L_{italicirt}}}{\frac{\sum_{i} L_{italicirt}}{\sum_{i} \sum_{r} L_{italicirt}}},

A second source of externalities are the diversity economies, commonly proxied by the inverse of the Herfindahl–Hirschman index of industry concentration based on the employment share of the different industries, excluding the respective industry (used by Fafchamps & Hamine, ; Carreira & Lopes, ; and Martin, Mayer, & Mayneris, ). The diversity economies (DIV), based on employment, for the industry i in region r with respect to the rest of the economy ( i' ≠ i ), are thus calculated as:

{DIV}_{irt} = \frac{1}{\sum_{\begin{matrix} i^{'} = 1 \\ i^{'} \neq i \end{matrix}} {(\frac{L_{i' rt}}{L_{rt} - L_{irt}})}^{2}}

Finally, to capture the regional knowledge base of a region, we consider regional R&D employment ( RD ), calculated as the number of employees that have, in each region, an occupation related to R&D (see Table for the details of the occupations that we have considered).…”

Section: Empirical Methodologymentioning

confidence: 99%

How are the potential gains from economic activity transmitted to the labour factor: more employment or more wages? Evidence from the Portuguese context

Carreira

Lopes

2020

Regional Science Policy & Practice

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The paper analyses the role of knowledge externalities in firms' employment and workers' wages. We test whether agglomeration economies and regional knowledge base exert a greater impact on wage growth than on employment growth, using spatial panel econometric techniques to control for unobserved spatial effects. Using a spatial panel for six Portuguese manufacturing industries, we found that regional knowledge spillovers, contrary to the theoretical assumptions, have a greater impact on employment in firms than on workers' wages. This analysis might enhance important policy debates about the effects of regional policies on employment and wages. K E Y W O R D Sagglomeration economies, employment and wages, manufacturing industries, regional knowledge spillovers, spatial panel econometrics

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{SPE}_{irt} = \frac{\frac{L_{irt}}{\sum_{r} L_{italicirt}}}{\frac{\sum_{i} L_{italicirt}}{\sum_{i} \sum_{r} L_{italicirt}}},

{DIV}_{irt} = \frac{1}{\sum_{\begin{matrix} i^{'} = 1 \\ i^{'} \neq i \end{matrix}} {(\frac{L_{i' rt}}{L_{rt} - L_{irt}})}^{2}}

Section: Empirical Methodologymentioning

confidence: 99%

How are the potential gains from economic activity transmitted to the labour factor: more employment or more wages? Evidence from the Portuguese context

Carreira

Lopes

2020

Regional Science Policy & Practice

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“…According to one of the criteria proposed by the European Commission, we define an SME as a firm whose annual turnover is between 10 and 50 million euro. We limit the sample to SMEs because they are more sensitive to the local context than larger enterprises (Carreira & Lopes, 2015).…”

Section: Empirical Strategymentioning

confidence: 99%

Firm financial soundness and knowledge externalities: A comparative regional analysis

Fattah

Arcuri

Garsaa

et al. 2020

Papers in Regional Science

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This paper investigates the role of the regional context with regard to the influence of human capital and knowledge spillovers on SMEs' financial soundness. Our empirical setting is based on a multilevel analysis of panel data, which allows superior treatment of hierarchical data. The analysis is applied to SMEs belonging to the manufacturing sector and operating in four European countries over the period 2010–2015. We find that a combination of individual and regional‐level characteristics explains firm soundness better than individual features alone. Furthermore, we find that a high local educational level and knowledge spillovers improve firm soundness and that their effects vary according to the regional level of knowledge. These results are confirmed by several robustness tests.

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Regional knowledge spillovers: a firm-based analysis of non-linear effects

Carreira

Lopes

2017

Regional Studies

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This article revisits the question of the role of knowledge externalities in firm productivity.It also addresses the overlooked issue of a plausible nonlinear effect and differences among industries. Using a panel of Portuguese manufacturing firms, it finds that regional knowledge spillovers differ substantially across industries and they are nonlinear, which is critical issue to promoting more assertive regional policies.

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Are Small Firms More Dependent on the Local Environment than Larger Firms? Evidence from Portuguese Manufacturing Firms

Cited by 4 publications

References 32 publications

How are the potential gains from economic activity transmitted to the labour factor: more employment or more wages? Evidence from the Portuguese context

How are the potential gains from economic activity transmitted to the labour factor: more employment or more wages? Evidence from the Portuguese context

Firm financial soundness and knowledge externalities: A comparative regional analysis

Regional knowledge spillovers: a firm-based analysis of non-linear effects

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