Scandinavian Working Papers in Economics

Working Paper Series in Economics and Institutions of Innovation,
Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies

No 306: The Impact of Spatial Externalities: Skills, Education and Firm Productivity

Sofia Wixe ()
Additional contact information
Sofia Wixe: Jönköping International Business School, Postal: Jönköping University, , P.O. Box 1026, SE-551 11 Jönköping, , Sweden

Abstract: This paper analyses the role of spatial externalities in explaining the average labour productivity of Swedish manufacturing firms. The empirical findings support MAR and Porter externalities as well as general urbanization economies, but not Jacobs externalities. In addition, the matching between the firm and the regional labour force is found to be productivity-enhancing. However, firm-specific characteristics, including the characteristics of the employees, are not to be forgotten. Especially since externalities are commonly associated with knowledge spillovers, and it is through the employees that the external knowledge is absorbed and channelled to the firm as a whole.

Keywords: Firm productivity; spatial externalities; manufacturing; Sweden

JEL-codes: D24; L25; L60; R32

26 pages, April 12, 2013

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