Working Paper: NBER ID: w20168
Authors: Lorenzo Caliendo; Fernando Parro; Esteban Rossi-Hansberg; Pierre-Daniel Sartre
Abstract: We study the impact of intersectoral and interregional trade linkages in propagating disaggregated productivity changes to the rest of the economy. Using regional and industry data we obtain the aggregate, regional and sectoral elasticities of measured TFP, GDP, and employment to regional and sectoral productivity changes. We find that the elasticities vary significantly depending on the sectors and regions affected and are importantly determined by the spatial structure of the economy. We use these elasticities to perform a variety of counterfactual exercises including a detailed study of the effects of the boom in the Computers and Electronics industry in California.
Keywords: Productivity; Regional Economics; Sectoral Changes; Trade Linkages
JEL Codes: E0; F1; F16; R12; R13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| disaggregated productivity changes (O49) | aggregate GDP elasticity (E10) |
| regional fundamental productivity increase in Florida (O49) | aggregate GDP elasticity (E10) |
| regional fundamental productivity increase in New York State (O49) | aggregate GDP elasticity (E10) |
| regional productivity increase (O49) | labor migration (J61) |
| labor migration (J61) | strain on local fixed factors (F16) |
| regional trade costs elimination (F15) | aggregate TFP gains (O49) |
| regional trade costs elimination (F15) | GDP gains (F62) |
| regional trade patterns (F14) | aggregate GDP elasticity (E10) |
| regional trade patterns (F14) | productivity changes (O49) |