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EVOLVING AGGLOMERATION IN THE U.S. AUTO SUPPLIER INDUSTRY *
Author(s) -
Klier Thomas,
McMillen Daniel P.
Publication year - 2008
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/j.1467-9787.2008.00549.x
Subject(s) - economies of agglomeration , logit , cluster analysis , nonparametric statistics , economic geography , nested logit , logistic regression , econometrics , industrial organization , economics , regional science , economy , geography , statistics , microeconomics , mathematics
Using nonparametric descriptive tools developed by Duranton and Overman (2005, Review of Economic Studies , 72, 1077–1106), we show that both new and old auto supplier plants are highly concentrated in the eastern United States. Conditional logit models imply that much of this concentration can be explained parametrically by distance from Detroit, proximity to assembly plants, and access to the interstate highway system. New plants are more likely to be located in zip codes that are close to existing supplier plants. However, the degree of clustering observed is still greater than implied by the logit estimates.