Measuring industry co-location across county borders. Issue 1 (2nd January 2020)

• Record Type: Journal Article
• Authors: Tian, Zheng; Gottlieb, Paul D.; Goetz, Stephan J.
• Is Part Of: Spatial economic analysis. Volume 15:Issue 1(2020)
• Page Start: 92
• Page End: 113
• Publication Date: 2020-01-02
• Subjects: location quotients -- spatial input–output location quotient (SI-LQ) -- industry agglomeration -- input–output linkages -- spatial correlation; R12 -- R15; Space in economics -- Periodicals; Economic geography -- Periodicals; Space in economics -- Econometric models -- Periodicals; Urbanization -- Periodicals; Espace (Économie politique) -- Périodiques; Économétrie -- Périodiques; Géographie économique -- Périodiques; Économie industrielle -- Périodiques; Économie du travail -- Périodiques; Économie urbaine -- Périodiques; Politique économique -- Périodiques; Relations économiques internationales -- Périodiques; 330.9
• DOI: 10.1080/17421772.2020.1673898
• Languages: English
• ISSNs: 1742-1772

Abstract

ABSTRACT: The location quotient (LQ) measures regional industry concentration with the advantages of easy calculation and interpretation. However, it is a weak method for identifying industry clusters that consist of related industries geographically concentrated in contiguous counties. This paper proposes a new spatial input–output location quotient (SI-LQ) accounting for both the co-location of related industries and the spatial spillover of concentration into neighbouring counties. A bootstrap method is used to determine the cut-off values of the new measure. The practical advantages of the SI-LQ over the traditional LQ include attenuation of the extreme values of the LQ in less populous and remote counties and the identification of large substantive clusters. The SI-LQ outperforms the LQ in a regression analysis of the effect of industry concentration on total employment growth.