Research Papers

Evaluating Industrial Agglomeration via Inter-firm Micro Transaction Data

Proceedings of Asian Seminar in Regional Science

In past evaluations of industrial agglomeration, business relationships have generally not been considered because it is difficult to obtain inter-firm micro transaction data, with Japan being the only exception.
Companies affect each other through inter-firm transactions. Therefore, it is necessary to focus on business relationships. This study evaluated industrial agglomeration via estimated transaction data which reflected transactions between business establishments such as factories and warehouses. In addition, we measured the degree of agglomeration with the method proposed by Duranton and Overman (2005) which compares the actual geographic distribution and random distribution.
As a result, we were able to evaluate industrial agglomeration quantitatively including the aspect of connection of transactions. In the evaluation, we classified industries as localized industry and dispersed industry. The most localized industry is Tableware (occidental type) manufacturing industry, the most dispersed industry is Miscellaneous seafood products manufacturing industry. In addition, we were able to pinpoint the negative aspects of not considering relation through transactions.

Yasuaki Kikukawa, Keisuke Takano, and Morito Tsutsumi

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