Localization of Industry and Vertical Disintegration

Thomas J. Holmes

doi:10.1162/003465399558102

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Localization of Industry and Vertical Disintegration

Thomas J. Holmes^1,2

¹ Federal Reserve Bank of Minneapolis · ² University of Minnesota

The Review of Economics and Statistics 1999 open access

Theory suggests that vertical disintegration should be greater in areas where industries localize. This paper provides some evidence that this implication is true for the U.S. manufacturing sector. Purchased inputs as a percent of the value of output is used as a measure of vertical disintegration. To measure the localization of industry, for each manufacturing plant the amount of employment in neighboring plants in the same industry is determined.

DOI: 10.1162/003465399558102
Volume: 81 (2)
Pages: 314-325
Language: en
Export: BibTeX
Sources: openalex crossref