2012•Richmond Fed Economic BriefRequires access
Explaining the car industry cluster: the case of U.S. car makers from 1895-1969
David A. Price, Zhu Wang
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Abstract
The geographic clustering of companies within an industry is often attributed to several agglomeration economies: intra-industry spillovers (benefits from proximity to firms in the same industry), inter-industry spillovers (benefits from proximity to firms in related industries), and spinoffs (firms established by former employees of a company in the same industry). Analysis of data on the U.S. auto industry in its first 75 years sheds light on the relative importance of those forces to the clustering of car makers