published in: Economics Bulletin, 2005, 17 (15), 1-8
This paper analyses the impact of dynamic MAR- and Jacobs-externalities on local
employment growth in Germany between 1993 and 2001. In order to facilitate a comparison
between the neighbouring countries we firstly replicate the study of Combes (2000) on local
employment growth in France and find very similar results for Germany. Afterwards we
formulate an alternative empirical model that is based on a weighted regression approach.
With this model we find that Jacobs-externalities matter in manufacturing, whereas MARexternalities
are present in advanced service sectors.
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