The Impact of Output and Productivity Changes on Manufacturing Employment

Traditional univariate shift-share studies of employment provide an unreliable indicator of the relative performance of a region or an industry for they fail to separate the effects of output and productivity change on the demand for labor. An extended shift-share model is proposed that overcomes this weakness and permits identification of different processes of regional development. This model is used to investigate annual employment change in twenty (two-digit SIC) manufacturing industries in nine census regions of the U.S. between 1950 and 1986. The timing and depth of the exodus of manufacturing jobs from the snowbelt to the sunbelt is illustrated along with the business cycle performance of industries and regions. Productivity growth in the sunbelt is positively associated with rapid output expansion, whereas in the snowbelt it is associated with the loss of market share and economic rationalization.     

Dynamic Shift-Share Analysis

Most applications of shift-share analysis to regional employment change have used a study period of several years and have examined conditions only at the beginning and end years. This comparative static approach does not take into account the continuous changes in both industrial mix and size of total employment of the region over the study period. Calculating the national growth effect, the industrial mix effect, and the competitive effect on an annual basis and then summing the results over the study period provides a more accurate allocation of job changes among the three shift-share effects. This approach, which we term dynamic shift-share analysis, also allows unusual years and years of economic transition to he identified. We illustrate the use of dynamic shift-share by presenting results of an analysis of New England employment growth from 1939 to 1984, using U.S. Bureau of Labor Statistics data. The use of the dynamic form of shift-share is important when the study period is characterized by either large changes in regional industrial mix or major differences between regional and national growth rates.     

On the Value of Homotheticity in the Shift-Share Framework

The purpose of this paper is to examine the usefulness of homothetic reformulations of the shift-share accounting model to the practitioner of regional growth studies. The reformulations of Esteban-Marquillas (1972) and Arcelus (1984) are examined to determine if they improve the shift-share framework as a means for accounting for regional economic growth or decline. The purpose of the homothetic models is to separate out change in a region's employment (or value added) associated with its prior or base year specialization in particular industries from change associated with changes in the mix of industries that occurred during the period under study. It is contended while the resulting accounts may help in understanding individual industry's growth rates, they shed little light on total regional growth. Indiana employment data from 1977 and 1986 are used to illustrate the arguments.     

Shift-Share Analysis: The International Dimension

This paper extends the traditional shift-share model to incorporate international effects. While some industries compete nationally for markets, other compete internationally. For industries competing nationally, regional growth derives from regional superiority relative to the national economy. For those competing internationally, regional growth is tied to regional advantages from specialization and competitive advantage relative to the international economy. Building on the Esteban - Marquillas concept of homothetic employment, the international shift-share model identifies regional growth due to regional and national competitive advantage and regional and national specialization. We demonstrate that the international model retains the property of region to region additivity.     

State Unemployment Differentials: Equilibrium Factors vs. Differential Employment Growth

: Differentials in U.S. state unemployment rates were persistent in the early 1990s. In addition, states with higher employment growth did not necessarily have the lowest unemployment rates. Thus, this paper examines the differentials in U.S. state unemployment rates from 1992 to 1994, decomposing them into the parts that were due to differences in recent employment growth, and those that were due to longer-term equilibrium factors. Also, using the shift-share model, employment growth differences are decomposed into an industry mix component and a competitiveness component. The decomposition of the 1992 to 1994 unemployment rate differentials is based on an econometric equation estimated using panel data from 1972 to 1991. Explanatory equilibrium factors included in the model are amenities, demographic characteristics, education, industry composition, labor mobility, and wage rates.     

Shift-Share Analysis and the Potential for Predicting Regional Growth Patterns: Some Evidence for the Region of Quebec,Canada

The purpose of this paper is to explain changes in regional attractiveness as measured by the competitive component of the shift-share model. This is done by applying the shift-share model to the manufacturing sector in the province of Quebec and using time series data for twenty two-digit industries as the basis of analysis. The study concludes that shift-share is useful for analyzing historical employment patterns and identifying their causes through regression analysis. However, the inherent structural instability limits the predictive potential of the model.     

Shift‐Share Analysis and Changes in Japanese Manufacturing Employment

Shift‐share analysis is used to examine the role of spatial structure on changes in regional manufacturing employment, in contrast to the traditional focus of shift‐share studies on the role of industrial structure. It is argued that changes in a region's space‐economy can be understood not only in terms of the economic subdivisions of the region but also in terms of the contribution of its spatial subdivisions. The latter is illustrated by means of a case study of the contribution of different types of local area to changes in regional manufacturing employment in Japan. Each region was subdivided into four types of local area based on population density. The analysis covered the period from 1981 to 1995, a time of major transformation in Japan's space‐economy. The shift‐share model was also used to estimate the impact of local area output and productivity on changes in regional employment. In general, the results show that there was a progressive underdevelopment of the core regions, associated with falling output and productivity. The country's peripheral regions were characterized by development, associated with rising output and productivity. Atthe local scale, however, the picture is far more complex. Types of local area contributed to regional employment change in very different ways, with respect to both time, region, and output/productivity. The contribution of local spatial structure to the regional space‐economy of Japan is fundamentally fragmented and uneven.     

Moonlighting in a High Growth Economy: Evidence from U.S. State‐Level Data

Despite the prevalence of multiple jobholding, there is relatively little research into its causes. Existing research has tested the predictions of standard labor models with micro data. Yet, there has been virtually no research into the relationship between moonlighting and structural differences in regional labor markets such as wages and employment growth. In this manner, this study examines the large differences in multiple jobholding rates across U.S. states. The findings indicate that multiple jobholding acts as a short‐term shock absorber to cyclical changes. However, in the long‐term, these effects dissipate, indicating that moonlighting plays a similar role as do changes in unemployment and labor‐force participation to regional labor market shocks. Conversely, multiple jobholding rates are inversely related to average weekly earnings. Thus, job growth accompanied by real wage (and productivity) growth may result in a decline in multiple jobholding, further exacerbating potential labor shortages. Other key factors found to influence multiple jobholding include occupational structure and education.     

The Incorporation Of Multiple Bases Into Shift-Share Analysis

This paper expands the shift-share technique by developing a methodology for selecting and including both primary- and secondary-base economies in the shift-share model. This is useful when the shift-share technique is applied to subregional economies, whose economic growth is typically tied to the economies of both the state and the nation. The expanded methodology is illustrated with data from the Lowell, Massachusetts, Primary Metropolitan Statistical Area (PMSA).     

中部地区产业结构演变与经济增长关系研究

以1995-2009年统计数据为基础,利用偏离-份额分析法（SSM）重点探究了中部地区的产业结构演替与经济增长之间的关系,为各省调整产业结构、促进中部崛起提供理论指导。结果表明：1.中部地区产业结构变化总体与产业结构演进的一般规律相符。2.中部地区产业结构演替对经济发展的影响情况分为：江西和安徽产业结构偏离为负,竞争力偏离份额为负;山西和河南产业结构偏离为正,竞争力偏离份额为负;湖北和湖南产业结构偏离为负,竞争力偏离份额为正等3种类型。3.产业结构变迁对各省经济增长的影响差异较大。     

Servicing Our Economy: Producer Service Location and Government Procurement 2004–2010 in the Washington DC Metropolitan Area

Harrington and Campbell (1997) previously illuminated the pattern of producer services' suburbanization in the Washington, D.C., metropolitan area between 1970 and 1992. Their results showed producer services growing at a faster rate at locations farther from the central city. We revisit the topic utilizing data from 2004 to 2010, assessing not only changes in the distribution of producer services since their work, but also the impact of massive increases in defense spending on producer services' growth throughout the first decade of the twenty‐first century. Multivariate linear regression is used to estimate per capita growth of producer services employment using six independent variables. Our results reveal producer services employment during the time period has grown significantly more quickly in the urban D.C. core than the outer suburbs, contrary to Harrington and Campbell's research. Additionally, we find per capita producer services employment is self‐limiting over the study period: locations with more producer services employment in 2004 experienced significantly less producer services growth over the period. We find federal procurement has no correlation on producer services overall, with limited effects on some subsectors. Analyzing a select group of producer services subsectors revealed that no sectors followed the overall model exactly, suggesting that targeting producer services for growth must be done carefully. None of our models show employment diversity to be a factor in differentiating economic growth at the intra‐metropolitan level.     

Integrating Firm Dynamics into the Shift‐Share Framework

ABSTRACT This article integrates firm birth and death data into a shift‐share analysis framework. The proposed methodology can be used when data availability does not allow for the direct association of employment changes to business demographics at the regional level. It may be also used as an exploratory step before any explanatory econometric work is undertaken as a means of identifying classes of potential control variables. Applying the method to Greek data suggests that firm‐size heterogeneity should not be ignored, that local conditions matter more than regional economic structure, and that the latter are asymmetrical across sectors when it comes to the effects of business demographics on regional employment or output growth.     

Considerations in Extending Shift-Share Analysis: Note

One of the limitations to the widespread use of the Esteban-Marquillas shift-share extension has been the Stokes (1974) proof of the lack of regional additivity of the Esteban-Marquillas competitive components. Since the Arcelus extension (1984) of the traditional shift-share decomposition is a continuation of the logical framework by Esteban-Marquillas (1972), the Stokes criticism would at first appear to have equal relevance to this new work. This note demonstrates that the relationship between the rate of growth of the larger region and the rates of growth of its constituent subregions is ignored in the Stokes criticism and in the subsequent critique by Beaudry and Martin (1979). By explicitly incorporating the relationship between the rate of growth of the larger region and the rates of growth of the constituent subregions, we also demonstrate that the recent shift-share extensions by Esteban-Marquillas and Arcelus share with the classical shift-share decomposition the desirable additive properties under regional disaggregation of the data.     

Spatial Industrial Dynamics in Sweden: Urban Growth Industries

In this paper two basic theories within spatial industrial dynamics—the filtering-down theory and the spatial product cycle theory—are used to explain processes of spatial decentralization and centralization of economic activities. In particular, a case is made for the idea that employment decentralization should be expected not only for growing and maturing manufacturing industries but also for growing and maturing service industries. Based upon this theoretical framework the empirical part of the paper analysis the spatial behavior during the period 1980 to 1993 of the employment in a group of 19 industries in Sweden—the so-called urban growth industries—with an expected high potential for employment decentralization. Most of the industries exhibited the expected pattern of employment decentralization with the larger medium-sized regions as the main winners. A shift-share analysis shows that the overall magnitudes of the competitive shift components are rather small and that, hence, Sweden during the period 1980–1993 did not experience a drastic change in the spatial distribution of its urban growth industries.     

State Infrastructure and the Geography of Employment

ABSTRACT The effects of state public capital investment on economic growth is an important question that has been the focus of a recent substantial research effort. But the majority of this research has ignored these investments’influence on the intra-state pattern of economic activity. Yet if external agglomeration economies are important determinants of growth, then investments may indirectly affect growth by fostering or discouraging agglomeration. This paper discusses the effect of state infrastructure investments on the distribution of employment within states and the implications of these spatial effects for aggregate state employment growth. Preliminary empirical results suggest that state infrastructure investments tend to redistribute growth from areas of dense employment to other parts of the state. This redistribution may diminish agglomeration benefits offered by cities, which has the potential to reduce state growth. The paper concludes with a discussion of implications of the work for research and policy.     

Global Markets and the Role of Geographical Proximity in Mexico's Employment Growth

In the context of greater economic integration with global markets and structural economic reforms, this paper analyses regional and sectoral employment growth dynamics in Mexican states between 2004 and 2014. The methodology is based on spatial shift‐share analysis that explicitly considers interregional interactions in employment while assessing potential spillover effects arising from spatial interactions among states and industrial sectors. The results suggest a competitive effect from some industries—such as those related to science and specialized suppliers, intensive scale industries and dominated providers—which led to the formation of industrial corridors of neighboring states that connect the central region with the northeast region of the country. It was also found that proximity to states such as Nuevo Leon, Queretaro, Guanajuato, San Luis Potosi, and Puebla has positively influenced neighboring states in terms of employment growth rates. The results also support the argument of some sort of de‐concentration of economic activity in the capital, Mexico City, toward neighboring states.     

Convergence of State Per Capita Incomes: An Examination of Its Sources

This paper examines the sources of regional convergence in per capita incomes over the last four decades. Growth in per capita income is decomposed into two major components: (1) growth in employment rates and (2) growth in wage rates per worker. Using annual data from the Bureau of Economic Analysis and the Bureau of Labor Statistics, the paper finds that the observed convergence in per capita incomes of sates was largely due to convergence in employment rates; wage rates either did not converge or did so weakly. Employing an instrumental variables technique, the paper finds that rapid growth in the work force with relatively low levels of human capital in initially poor states was a depressing influence on wage rate growth in these states, and was a major reason for the relatively slow convergence in per capita incomes.     

Developments in the Location of Selected Computer-Related Industries in the united states

This study focuses upon changes in three computer-related industries between 1974 and 1985. An attempt is made by means of entropy indices and shift-share analysis to determine if diffusion in those industries conforms to the product-cycle model. We employ primarily state-level data derived from County Business Patterns and supplemented by US. Censuses of Manufacturing and Services. Our findings indicate that all the industries displayed substantial increases in employment and considerable dispersion, although by no means were the changes uniform. The hypothesis that the dispersion is following the product-cycle model, that is, from core areas to peripheral regions, receives little support from this study. The model, however, should not be rejected out of hand, because all three industries studied have a duality in the size of firms that the data masks. This duality may affect the applicability of any model. Further attempts to explain the spatial distribution of any of these industries should begin with disintegrated data. Unfortunately such data are not presently easily attainable.     

Can State Tax Policy Increase Economic Activity and Reduce Inequality?

Previous research shows that when changes in national commodity and income tax rates affect labor supply decisions differently, relative rates can be altered to increase welfare. In the U.S., 40 states impose both a sales and income tax; however, the reliance varies widely. This paper uses a computable general equilibrium model to examine tax policy changes in Colorado. The findings suggest that the revenue neutral changes to income and sales tax rates can affect both the level of economic activity and the distribution of income. When labor force participation is highly sensitive to income tax rate changes—which this paper suggests is the case—progressive changes to Colorado's tax policy changes can both reduce inequality and increase output and employment.     

Exploring the recent upsurge in productivity disparities among European regions

This paper analyses thse evolution of productivity disparities across 156 European regions in the period 2000–2015. Using regional data, a battery of inequality indexes enables us to assess the extent of regional disparities. After confirming that labour productivity is the main component of income disparities, a dynamic shift-share analysis is carried out at a 10-industry level of disaggregation. The study evaluates the relative role of the three components underlying the disparities in regional productivity: changes in the industry mix, and within- and between-industry productivity gaps. The main results can be summarised as follows. First, regional disparities are on the rise again in the EU. Second, most regions are now closer to the average, while a small group of the richest regions are moving further away. Third, the main drivers of productivity disparities are within-industry differences in labour productivity with regard to the richest regions and, less importantly, the specialisation of the richest regions in more progressive industries. Finally, the net effect of structural change is still making a positive contribution to convergence with the leading regions.