Who's right, Marshall or Jacobs? The localization versus urbanization debate

By Catherine Beaudry, Andrea Schiffauerova. 2009

986 citations recorded by the source corpus.

A large amount of literature provides empirical evidence in support of Marshall or Jacobs theories regarding the specialization or diversity effects on the economic performance of regions. This paper surveys these scholarly contributions and summarizes their results according to their similarities and differences. The reviewed empirical work presents a diverse picture of possible conditions and circumstances under which each kind of externalities could be at work. The wide breadth of findings is generally not explained by differences in the strength of agglomeration forces across industries, countries or time periods, but by measurement and methodological issues. The levels of industrial and geographical aggregation together with the choice of performance measures, specialization and diversity indicators are the main causes for the lack of resolution in the debate. The 3-digit industrial classification seems to be the level at which MAR and Jacobs effects are undistinguishable from one another, and this is often exacerbated by a high level of geographical aggregation.

Subfields: Economics and Econometrics, Political Science and International Relations

View Paper: https://www.semanticscholar.org/paper/4b0b928901189157c7807a078f6941893e3f7ec7

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Citations in the corpus

Entrepreneurship as an Urban Event? Empirical Evidence from European Cities (2014, background): “In regional economics these agglomeration effects are usually differentiated either into localization and urbanization economies (see BEAUDRY and SCHIFFAUEROVA, 2009, for an overview) or in three types of micro-foundations, based upon sharing, matching and learning mechanisms (DURANTON and THISSE,…”
Foreign Direct Investment Spillovers and the Geography of Innovation in Chinese Regions: The Role of Regional Industrial Specialization and Diversity (2016, background): “Finally, the intense use of infrastructure by a highly specialized industry within a certain geographical region is more efficient than its use by scattered industrial configurations (BEAUDRY and SCHIFFAUEROVA, 2009).”
Both Marshall and Jacobs were Right! (2016, background): “Beaudry and Schiffauerova (2009), Melo et al. (2009), and De Groot et al. (2009) all pointed to the relevant impacts of the choice of indicators of specialization and diversity, and of different levels of spatial and industrial aggregation, on the size or probability of identifying positive impacts ”
What makes student entrepreneurs? On the relevance (and irrelevance) of the university and the regional context for student start-ups (2016, background): “Among the most important economic characteristics of regions are agglomeration effects, i.e. localisa- tion and urbanisation economies (see Beaudry & Schiffauerova, 2009, for an overview).”
The Role of External Linkages and Gatekeepers for the Renewal and Expansion of US Cities' Knowledge Base, 1990–2004 (2015, background): “This accounts for the local market structure and captures whether more competitive cities enable greater knowledge creation and recombination (BEAUDRY and SCHIFFAUEROVA, 2009).”
Related variety and regional growth in Spain (2011, result): “Despite all their efforts, this literature has led to inconclusive results so far with respect to the question whether localization economies and Jacobs’ externalities matter for urban and regional growth (Beaudry and Schiffauerova, 2009; De Groot et al., 2009).”
Mapping Knowledge Space and Technological Relatedness in US Cities (2013, background): “…measures of specialization or diversity in the agglomeration literature, are often based on shares of sectoral output or employment in Herfindahl and related indices (Henderson et al., 1995; Ellison & Glaeser, 1999; Drucker, 2011 and see Beaudry and Schiffauerova (2009) for their use).”
Related and unrelated variety as regional drivers of enterprise productivity and innovation: A multilevel study (2016, background): “It has been debated whether specialization or diversity foster local externalities in terms of knowledge or technology spillovers (Beaudry and Schiffauerova, 2009), but we emphasize that industrial specialization is a two-dimensional construct in which a low level of specialization can indicate a re”
The effects of global knowledge reservoirs on the productivity of multinational enterprises: The role of international depth and breadth (2012, background): “They also contribute to the longstanding debate on specialization versus diversity (Beaudry and Schiffauerova, 2009), suggesting that the performance effects of diversity (or breadth) are particularly important.”
Entrepreneurship and economic development in cities (2015, methodology): “Although the historical evidence of entrepreneurship-led growth in cities is vast (Beaudry and Schiffauerova, 2009; de Groot, Poot and Smit 2009; Rosenthal and Strange, 2004)) to name a few, the contexts that transforms new business into economic development and the mechanisms applied remain under…”
The Impact of Related Variety on Regional Employment Growth in Finland 1993–2006: High-Tech versus Medium/Low-Tech (2012, background): “Some studies find either positive or negative effects, whereas others find no evidence for the presence of Jacobs’ externalities (overviews are given in Beaudry and Schiffauerova, 2009; De Groot et al., 2009).”
Spatial Heterogeneity in Knowledge, Innovation, and Economic Growth Nexus: Conceptual Reflections and Empirical Evidence (2014, background): “…innovation creation, and local growth.5 The importance of agglomeration economies has in fact been consistently documented in the literature (see Beaudry and Schiffauerova, 2009, for a review) on innovative and regional performance, as well as in the NEG debate (Krugman, 1991); ceteris paribus,…”