LOCAL INPUT AND PRODUCTIVITY GROWTH IN U.S. MANUFACTURING: 1972–2002* |
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| Authors: | George W Hammond Eric C Thompson |
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| Institution: | 1. Department of Economics and Bureau of Business and Economic Research, West Virginia University, P.O. Box 6025, Morgantown, WV 26506. E‐mail: ghammond@wvu.edu;2. Department of Economics and Bureau of Business Research, University of Nebraska‐Lincoln, 347 College of Business Administration Building, Lincoln, NE 68588–0406.E‐mail: ethompson2@unl.edu |
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| Abstract: | ABSTRACT This research analyzes manufacturing growth and decline across metropolitan and nonmetropolitan regions during the 1972–2002 period. We decompose real value added growth across local labor market areas in the lower 48 U.S. states into contributions from labor, capital, and total factor productivity. We then estimate a model describing the long‐run growth of labor, capital, and productivity and find that increased productivity increases the growth of labor and capital, as well as a positive correlation between labor and capital stock growth. We also find evidence that human capital investment and agglomeration economies encourage productivity growth, while unionization discourages it. |
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