Joshua Drucker

Reconsidering the Regional Economic Development Impacts of Higher Education Institutions in the United States

Drucker J. Reconsidering the regional economic development impacts of higher education institutions in the United States, Regional Studies. This study models relationships between US higher education activities and regional economic performance, 2001–11. Advances include incorporating all degree-granting institutions; estimating spatial spillovers; and comparing multiple economic outcomes, including production and entrepreneurship. Higher education impacts vary by outcome measure but are less influential than in previous studies. Spillovers are substantial up to 60 miles (97 kilometres), reflecting considerable influence across space. More advanced degrees, science and engineering education, and population educational attainment are positively associated with entrepreneurial activity. These findings encourage the traditional university missions of research and teaching, and general policies promoting entrepreneurship, to support economic performance.

Regional Industrial Structure Concentration in the United States: Trends and Implications

Abstract In a seminal article, Chinitz (1961) considered the effects of industry size, structure, and economic diversification on the performance of firms and regional economies. His inquiry suggested a related but conceptually distinct issue: how does the extent to which a regional industry or industrial sector is concentrated in a small number of firms affect the local performance of that industry? The question has not been addressed systematically in empirical research other than case studies, principally because accurately measuring regional concentration requires firm-level information. This exploratory study uses confidential plant-level data to gauge concentration in manufacturing industries at the regional scale across the continental United States, to explore changes over time in geographic patterns of concentration, and to investigate associations between regional industrial structure concentration and changes in employment. The implications for understanding the impacts of regional industrial structure on economic development processes are discussed.

Regional Industrial Dominance, Agglomeration Economies, and Manufacturing Plant Productivity

In a seminal article, Benjamin Chinitz (1961) focused attention on the effects that industry size, structure, and economic diversification have on firm performance and regional economies. He also raised a related but conceptually distinct question that has been overlooked since: how does the extent to which a regional industry is concentrated in a single or small number of firms impact the performance of other local firms within that industry? He suggested that such regional industrial dominance may impact input prices, limit capital accessibility, deter entrepreneurial activity, and reduce the regional availability of agglomeration economies such as specialized labor and supply pools In this paper, we use an establishment-level production function to quantify the links between industrial dominance, agglomeration economies, and firm performance. We consider two questions. First, do greater levels of regional industrial dominance lead to lower economic performance by small, dominated manufacturing plants? Second, are small plants in dominated regional industries more limited in capturing regional agglomeration benefits and therefore do they face rigidities in deploying production factors to maximum advantage? Our results suggest that regional industrial organization does influence productivity but that the effect tends to be a direct one, rather than an indirect effect via its influence on agglomeration economies.

An Evaluation of Competitive Industrial Structure and Regional Manufacturing Employment Change

Drucker J. An evaluation of competitive industrial structure and regional manufacturing employment change, Regional Studies. This paper examines the relationship between regional industrial structure and employment change in the manufacturing sector and nineteen subsectors in the United States from 1987 to 1997. The relative associations of economic diversity, industrial specialization and competitive structure with economic performance are assessed using a non-causal regression framework. Multiple facets of industrial structure at the regional scale, including competitive structure, are considered together by exploiting confidential microdata to construct and evaluate detailed metrics across broad geographic and industrial ranges. The findings suggest the importance of industrial competitive structure for understanding regional employment change, economic performance and industrial development.

Does Economic Diversity Enhance Regional Disaster Resilience

Problem, research strategy, and findings: Little research examines the effect of diversity on regional economic resilience to natural disasters. We examine whether economic diversity benefits regional economies in typical circumstances and in recovery after a natural disaster, using the case of the 1993 U.S. Midwest flood. By matching counties in the nine states affected by the flood to control counties, we isolate the influence of diversity on employment and income in normal circumstances and after a substantial shock. We found economic diversity to have mixed associations with employment and income in typical circumstances. On average, economically diverse counties tended to experience faster employment gains but slower growth in per capita income than less diverse areas. The effect of economic diversity upon resilience following a natural disaster was unambiguous. Economic diversity aided counties in weathering the downturn following the flood and sped their return to long-term patterns of employment and income growth. Takeaway for practice: In promoting policies to enhance economic diversity, planners in communities located in areas prone to natural disasters should consider both the goal of disaster resilience and the potential tradeoffs between different aspects of economic performance. Research support: None.

Economic Impact Analysis amid Rapid Change Challenges, Strategies, and Examples from Defense Communities

This article examines issues in conducting economic impact analyses in regions undergoing substantial or rapid transformations. Economic impact analysis methods, like many other analytical techniques, are predicated on economic stability, yet commonly are applied to situations that violate this condition with little consideration of the implications. Special attention is paid to regional input–output modeling because of its prevalence in economic impact studies and susceptibility to distortions. Advice and suggestions for practitioners and educators teaching analytical techniques are discussed. Military communities in the United States impacted by the 2005 round of base realignments provide illustrative examples and applications.

The Spatial Extent of Agglomeration Economies: Evidence from Three U.S. Manufacturing Industries

The spatial extent of localized agglomeration economies constitutes one of the central current questions in regional science. It is crucial for understanding firm location decisions and for assessing the influence of proximity in shaping spatial patterns of economic activity, yet clear-cut answers are difficult to come by. Theoretical work often fails to define or specify the spatial dimension of agglomeration phenomena. Existing empirical evidence is far from consistent. Most sources of data on economic performance do not supply micro-level information containing usable geographic locations. This paper provides evidence of the distances across which distinct sources of agglomeration economies generate benefits for plants belonging to three manufacturing industries in the United States. Confidential data from the Longitudinal Research Database of the United States Census Bureau are used to estimate cross-sectional production function systems at the establishment level for three contrasting industries in three different years. Along with relevant establishment, industry, and regional characteristics, the production functions include variables that indicate the local availability of potential labor and supply pools and knowledge spillovers. Information on individual plant locations at the county scale permits spatial differentiation of the agglomeration variables within geographic regions. Multiple distance decay profiles are investigated in order to explore how modifying the operationalization of proximity affects indicated patterns of agglomeration externalities and interfirm interactions. The results imply that industry characteristics are at least as important as the type of externality mechanism in determining the spatial pattern of agglomeration benefits. The research methods borrow from earlier work by the author that examines the relationships between regional industrial structure and manufacturing production.

Regional industrial concentration in the United States: Trends and implications.

Abstract In a seminal article, Chinitz (1961) considered the effects of industry size, structure, and economic diversification on the performance of firms and regional economies. His inquiry suggested a related but conceptually distinct issue: how does the extent to which a regional industry or industrial sector is concentrated in a small number of firms affect the local performance of that industry? The question has not been addressed systematically in empirical research other than case studies, principally because accurately measuring regional concentration requires firm-level information. This exploratory study uses confidential plant-level data to gauge concentration in manufacturing industries at the regional scale across the continental United States, to explore changes over time in geographic patterns of concentration, and to investigate associations between regional industrial structure concentration and changes in employment. The implications for understanding the impacts of regional industrial structure on economic development processes are discussed.

Trends in Regional Industrial Concentration in the United States

In a seminal article, Benjamin Chinitz (1961) raises the question of the effects that industry size, structure, and economic diversification may have on firm performance and regional economies. His line of inquiry suggests a related but conceptually distinct issue: how does the extent to which a industry is regionally dominated—concentrated locally in a single or small number of firms—impact the local performance of that industry? This question has received little attention, principally because accurately measuring industrial concentration at the regional scale requires firm-level information. This paper makes use of confidential plant- and firm-level manufacturing data to explore patterns of industrial concentration in the United States at the regional scale. Regional analogues of concentration ratios and other measures commonly used in the aspatial industrial organization literature indicate the extent to which manufacturing activity is concentrated in a small number of firms. Both the manufacturing sector as a whole and major manufacturing industry sectors are examined in order to determine the extent of industrial concentration in the continental United States, to explore changes over time in geographic patterns of concentration, and to investigate associations between industrial concentration and employment growth at the regional scale. Implications for understanding regional growth and for devising regional economic development policy are discussed.

How Does Size Matter? Investigating the Relationships Among Plant Size, Industrial Structure, and Manufacturing Productivity

Industrial concentration and market power have been studied extensively at the national scale, in fields ranging from economics and industrial organization to regional science and economic development. At the regional scale, however, industrial structure and firm size relationships have received little attention outside of non-generalizable case studies, primarily because accurate measurements require difficult-to-obtain plant- or firm-level information. Readily available secondary data sources on establishment size distributions (such as County Business Patterns or the Census of Manufactures) cannot be linked to performance information for particular establishments or firms. Yet region-specific industrial structure may be a crucial determinant of firm performance and thus regional economic fortunes as well (Chinitz 1961; Christopherson and Clark 2007). This paper examines how industrial concentration and agglomeration economies impact plant performance, focusing on the influence of establishment size in mediating these effects. The Longitudinal Research Database of the U.S. Census Bureau is accessed to construct production functions for three manufacturing industries nationwide. These production functions, specified at the establishment level, incorporate characteristics of establishments, industries, and regions, including spatially-differentiated measures of agglomeration economies. Establishment size is evaluated both as an absolute metric and relative to other regional industry plants, as theory suggests that absolute size may be most pertinent to agglomeration benefits but relative size more relevant to industrial structure (Caves and Barton 1990; Bothner 2005). The research builds on earlier work by the author that establishes a direct link between regional industry concentration and the productivity of manufacturing establishments.