The Dynamics of Local Employment in France

Transcription

1 DISCUSSION PAPER SERIES IZA DP No The Dynamics of Local Employment in France Pierre-Philippe Combes Thierry Magnac Jean-Marc Robin March 2004 Forschungsinstitut zur Zukunft der Arbeit Institute for the Study of Labor

2 The Dynamics of Local Employment in France Pierre-Philippe Combes CERAS-ENPC, CNRS and CEPR Thierry Magnac INRA, CREST-INSEE, CEPR and IZA Bonn Jean-Marc Robin University of Paris 1, CREST-INSEE, CEPR and IZA Bonn Discussion Paper No March 2004 IZA P.O. Box Bonn Germany Phone: Fax: Any opinions expressed here are those of the author(s) and not those of the institute. Research disseminated by IZA may include views on policy, but the institute itself takes no institutional policy positions. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit company supported by Deutsche Post World Net. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available on the IZA website ( or directly from the author.

3 IZA Discussion Paper No March 2004 ABSTRACT The Dynamics of Local Employment in France We study the impact of local economic structure on employment dynamics. Local employment is decomposed into the product of the average plant size and the number of plants in the area and industry. We estimate the dynamics of both components simultaneously using French yearly data on 36 industries and 341 areas between 1984 and The careful specification of short-run dynamics and the control for fixed effects and endogeneity are shown to be critical in the empirical model. First, static externalities are prevalent compared to dynamic ones. Moreover, whereas area-and-industry effects explain most of the spatial variation of plant size, the local number of plants is mainly driven by the current local economic structure. Policies targeted towards plant creation should thus be more efficient. For instance, large areas endowed with a small number of even size industries have both more and larger plants. A large number of plants heterogeneous in size increases the average plant size, but the number of plants is higher when plants have similar size. JEL Classification: J21, C33, R23, J23 Keywords: labor market, panel data, economic geography, employment Corresponding author: Thierry Magnac INRA 48, boulevard Jourdan Paris France tmagnac@ens.fr Financial support from the Commissariat Général du Plan and NATO (Combes advanced fellowship grant) are gratefully acknowledged. We thank Eve Caroli, Eric Maurin, the editor, two anonymous referees as well as seminar participants at Ammersee, Paris Jourdan, and PUC-Rio for their useful comments. The usual disclaimer applies.

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18 Wkh Vdujdq whvw ri ryhulghqwli lqj uhvwulfwlrqv ru/ htxlydohqwo / wkh whvw ri wkh ydolglw ri wkh lqvwuxphqwv/ frphv rxw zlwk d s0ydoxh zhoo deryh 8(1 Wklv phdqv wkdw zh gr qrw uhmhfw wkh qxoo k srwkhvlv ri h{rjhqhlw ri wkh lqvwuxphqwv dw dq uhdvrqdeoh ohyho1 Pruhryhu/ urzv DF+4,/ DF+5, dqg DF+6, uhsruw wkh hvwlpdwhv ri wkh dxwrfruuhodwlrq frh!flhqwv ri rughu 4/ 5dqg 6 ri wkh huuru whup 5r 1 Wkh vljqlfdqfh suredelolwlhv +s0ydoxhv ri wkh w0whvw ri qxoolw, lqglfdwh d vwurqj uhmhfwlrq ri wkh k srwkhvlv wkdw wkh uvw dqg vhfrqg dxwrfruuhodwlrqv duh }hur exw lqglfdwh wkdw wkh dxwrfruuhodwlrq ri rughu 6 lv qrw vwdwlvwlfdoo glhuhqw iurp }hur/ zklfk lv frqvlvwhqw zlwk rxu lqlwldo dvvxpswlrq wkdw 5r lv PD+5,1 Wr vxp xs/ doo vshflfdwlrq whvwv vkrz wkdw rxu suhihuuhg vshflfdwlrq ri htxdwlrq +46, wv gdwd zhoo dqg wkdw rxu hvwlpdwlrq phwkrg lv olnho wr lhog frqvlvwhqw sdudphwhu hvwlpdwhv1 : Wkh hvwlpdwh ri wkh dxwruhjuhvvlyh frh!flhqw dw 31;:; lv yhu suhflvh dqg vljqlfdqwo glhuhqw iurp erwk 3 dqg 41 Pruhryhu/ qrwlfh wkh dowhuqdwlqj vljqv dqg wkh vlplodu pdjqlwxgh ri wkh frh!flhqwv ri frqwuro yduldeohv q 5rc 3 >{ 5rc 3 uhodwlyh wr q 5rc 32 >{ 5rc 32 1 Wklvvxjjhvwvhvwlpdwlqj wkh iroorzlqj frqvwudlqhg irup ri prgho +48,= c 5r c 5rc +q 5r q 5rc 3,. { 5r { 5rc 3. x 5r. 5r = +49, Wkh hvwlpdwhv ri wkh sdudphwhuv ri wklv htxdwlrq duh uhsruwhg lq wkh vhfrqg froxpq ri Wdeoh 61 Dv wklv prgho lv qrw olqhdu/ lw lv hvwlpdwhg e dsso lqj Wzr0Vwdjh Qrq0Olqhdu Ohdvw Vtxduhv +5VQOV, wr wkh glhuhqfhg prgho1 ; Zh xvh wkh vdph vhw ri lqvwuxphqwv dv ehiruh1 Wkdqnv wr wkh frqvwudlqwv rq wkh sdudphwhuv/ wkh hvwlpdwhv duh yhu suhflvh1 < Dvvxplqj d PD+4, vwuxfwxuh iru wkh wudqvlwru vkrfn 5r = 5r.! 5rc 3 > sdudphwhu! fdq eh uhfryhuhg e xvlqj wkh uhvlgxdov ri wkh hvwlpdwlrq uhsruwhg lq Wdeoh 61 Pruh0 ryhu/ dq hvwlpdwh ri wkh yduldqfh ri 5r fdq dovr eh uhfryhuhg iurp wkh hvwlpdwhg yduldqfh ri wkhvh uhvlgxdov1 Wkh prylqj dyhudjh sdudphwhu! lv yhu suhflvho hvwlpdwhg dw d vpdoo ydoxh= 3=473 45=;,1 Wklv qhjdwlyh vljq lv frqvlvwhqw zlwk wkh h{lvwhqfh ri phdvxuhphqw huuruv/ zklfk duh sodxvleoh jlyhq wkh gdwd vdpsolqj uxoh ri uhfruglqj wkh hpsor phqw ri wkh vroh sodqwv hpsor lqj pruh wkdq 53 zrunhuv1 Krzhyhu/ dv wkh dxwrfruuhodwlrq frh!flhqw! lv vpdoo hqrxjk dqg vwdqgv iru : Djdlq/ wklv lv wkh uhvxow ri wkh vhdufk iru wkh ehvw vshflfdwlrq/ dv ghwdlohg lq Frpehv hw do ,1 ; Zh h{sorlw wkh elolqhdulw ri wkh prgho dv iroorzv1 Ohw 5 5r eh d yhfwru ri lqvwuxphqwv1 Sdudphwhuv 4 dqg K 'Ek cq fdq wkhq eh hvwlpdwhg e lwhudwlqj xqwlo frqyhujhqfh wkh iroorzlqj dojrulwkp= Jlyhq d sdlu E4 E? ck E? ri sdudphwhu ydoxhv/ d qhz hvwlpdwh E4 E?n ck E?n lv frpsxwhg e dsso lqj 5VOV wr wkh uhjuhvvlrq ri { 5r rq yduldeohv { 5rc 3 dqg {% 5r 3 4 E? {% 5rc 3 lqvwuxphqwhg e 5 5r 1 < Qrwh wkdw wkh uhsruwhg vwdqgdug huuruv duh eldvhg dv wkh kdyh ehhq frpsxwhg xqghu wkh dvvxpswlrq wkdw wkh hvwlpdwh ri 4 lv lqghshqghqw ri wkh hvwlpdwh ri +k cq dqg dvvxplqj dzd dq vhuldo dqg vsdwldo ghshqghqfh1 Krzhyhu/ zh wulhg wr lpsohphqw vrph fruuhfwlrqv wr jhw d vhqvh ri wkhlu pdjqlwxgh1 Wkhvh h{shulphqwv lqglfdwh wkdw rqh vkrxog qrw h{shfw 0vwdwlvwlfv wr ghfuhdvh e pxfk pruh wkdq d idfwru ri 63(/ zklfk pdnh wkh yduldeohv vwloo odujho vljqlfdqw1 Wkhvh uhvxowv duh dydlodeoh xsrq uhtxhvw1 49

19 Wdeoh 6= Dyhudjh sodqw vl}h 0 G qdplf prgho q 5r 3=5;4 Eeb c 5 3=58: E S v 5 +4, +5, 3=3<6 EfD gly 5 3=499 E2e frps 5r 3=7<: E3 b prqr 5r 3=335 E3f c 5rc 3 3=;:; E S q 5rc 3 c 5c 3 3=58: E D 3=56: E3e2 v 5c 3 3=56< Ee gly 5c 3 3=43< E3ee frps 5c 3 3=85< E S 3=5;: E2f 3=59; E D 3=564 EH. 3=469 EbH 3=8:9 E2S. 3=396 EHD 3=;3< E2f prqr 5c 3 3=3:5 0 Eeb Vdujdq whvw +s0ydoxh, 3=;6< 3=854 DF+4, 3=8:< EÉ f 3D DF+5, 3=3;7 EÉ f 3D =8:9 EÉ f 3D 3=3;5 EÉ f 3D DF+6, 3=336 3=337 EfD. EfD Vdpsoh vl}h Qrwhv= Vwdqgdug huuruv duh qrw fruuhfwhg iru eldvhv gxh wr wkh elolqhdu qdwxuh ri wkh hvwlpdwlrq phwkrg qru iru eldvhv gxh wr vhuldo dqg vsdwldo ghshqghqfh1 H{shulphqwv dydlodeoh xsrq uhtxhvw vkrz wkdw wkh fruuhfwlrq idfwru lv dw prvw htxdo wr 63(1 Vwxghqwv vwdwlvwlfv duh uhsruwhg lq eudfnhwv1 4:

20 phdvxuhphqw huuruv/ wkh vhohfwlrq ri udwkhu odujh hvwdeolvkphqwv deryh 53 hpsor hhv lv qrw olnho wr eldv wkh hvwlpdwlrq wrr pxfk1 Lw lv qdoo srvvleoh wr uhzulwh prgho +49, lq wkh iroorzlqj zd 1 Vlqfh wkh hvwlpdwh ri wkh dxwruhjuhvvlyh sdudphwhu lv vljqlfdqwo glhuhqw iurp rqh/ rqh fdq glylgh erwk phpehuv ri htxdwlrq +49, e wkh odj sro qrpldo 4 O dqg rewdlq wkh iroorzlqj uhsuhvhqwdwlrq= c q 5r. { 5r. x 5r 4. 5r 4 O = +4:, Wkh g qdplfv ri orfdo dyhudjh sodqw vl}h c 5r lv wkxv yhu vlpsoh= c 5r xfwxdwhv lq d vwdwlrqdu zd durxqg d prylqj wdujhw/ wkdw lv= c c ua 5r. % 5r > +4;, zlwk c ua q 5r. { 5r. x 5r 4 +4<, dqg % # 5r lv dq DUPD+4/4, vwdwlrqdu surfhvv u Htxdwlrq +4:, lv dq lpsruwdqw uhvxow lq lwvhoi dv lw vkrzv wkh ydolglw ri wkh vwdwlf Frxuqrw prgho ghyhorshg lq wkh uvw vhfwlrq1 Wkh uhodwlrqvkls ehwzhhq/ rq wkh rqh kdqg/ dyhudjh sodqw vl}h c 5r dqg wkh qxpehu ri sodqwv q 5r dqg/ rq wkh rwkhu kdqg/ wkh frqwuro yduldeohv { 5r zklfk duh vxssrvhg wr ghwhuplqh surgxfwlylw vkrfnv lv h{dfwo ri wkh irup ri wkh wkhruhwlfdo htxdwlrq +;,1 Lqqrydwlrq huuruv 5r / ru vkrfnv gulyhq e xqrevhuyhg yduldeohv/ vkliw c 5r dzd iurp lwv wdujhw c ua 5r 1 Wkh uhwxuq wr wkh htxloleulxp lv vprrwk exw uhodwlyho vorz/ zlwk dq dxwr0uhjuhvvlyh frh!flhqw Diwhu 43 hduv/ dq lqlwldo srvlwlyh lqqrydwlrq vkrfn vwloo frqwulexwhv wr vhw c 5r deryh c ua 5r e d iudfwlrq +, 45( ri wkh lqlwldo vkrfn1 Lpsxovh0uhvsrqvh ixqfwlrqv duh frpphqwhg ehorz diwhu wkh frpsohwlrq ri wkh dqdo vlv iru erwk vhulhv1 Zh uhsruw lq Wdeoh 7 wkh yduldqfh0fryduldqfh ghfrpsrvlwlrq lqgxfhg e wkh hvwlpdwlrq ri htxd0 wlrq +4:,1 Wkh orqj0whup wdujhw c ua 5r h{sodlqv ;8( ri wkh wrwdo yduldqfh1 Wklv lv e doo phdqv d odujh frqwulexwlrq/ dqg lw phdqv wkdw vkrfnv % 5r duh qhyhu elj hqrxjk wr pryh c 5r yhu idu dzd iurp lwv htxloleulxp sdwk c ua 5r 1 Wkh frqwulexwlrq ri wkh duhd0dqg0lqgxvwu hhfwv x 5r wrwkhyduldqfhri c ua 5r lv dovr irxqg wr eh odujh +;:(,1 Frqwuro yduldeohv q 5r / c 5 / gly 5 / frps 5r dqg prqr 5r duh wkxv irxqg wr ghwhuplqh wkh orqj0uxq sdwk ri c 5r rqo prghudwho +49(,1 Wkh vkduhv ri yduldqfh h{sodlqhg gr qrw vxp wr 4 ehfdxvh wkh duh qrw ruwkrjrqdo +wkh fruuhodwlrq lv htxdo wr ,1 43 Wkhyduldqfhrizklfklv # 5r D 5r n Y E0 5r 'Y ' Y D 5rc u 3 4 u ' n24 n 2 Y ED 5r ;

21 Wdeoh 7= Dyhudjh sodqw vl}h 0 Yduldqfh ghfrpsrvlwlrq Yc ua 5r Y + q 5r. { Ä 5r, Y 5r 34 Fruu Yc 5r Yc ua 5r Yc ua q 5r. { 5r > Ä 5r r 3=;85 3=494 3=;:4 3= Qxpehu ri Sodqwv +? 5r, Lq wklv vhfwlrq/ zh uhsolfdwh wkh suhylrxv phwkrgrorj wr dqdo }h wkh g qdplfv ri wkh qxpehu ri sodqwv e duhd0dqg0lqgxvwu 1 Zh vwduw zlwk wkh iroorzlqj vshflfdwlrq= q 2 q 5rc 3. 2 c 5rc c 5rc 32. { 5r 2f. { 5rc 3 2. x 25r. 25r > +53, zkhuh wkh frh!flhqw ri wkh yduldeoh prqr 5r lq 2f lv frqvwudlqhg wr eh }hur wr dyrlg h{sodlqlqj q 5r e d ixqfwlrq ri lwvhoi1 Zh dvvxph wkdw H 25r mc 5rc 3 > c 5rc 3e > ===> q 5r > { 5r >q 5rc 3 > { 5rc 3 dqg xvh LY rq wkh glhuhqfhg prgho zlwk lqvwuxphqwv c 5rc 3 >q 5r > { 5r >q 5rc 3 > { 5rc 3 >q 5rc 32 > { 5rc 32 = Wkh uvw froxpq ri Wdeoh 8 uhsruwv wkhvh hvwlpdwhv1 Zh djdlq revhuyh wkdw wkh frh!flhqwv ri hdfk yduldeoh dqg lwv odj kdyh rssrvlwh vljqv/ dqg wkhuhiruh uhhvwlpdwh xvlqj wkh vdph whfkqltxh dv ehiruh/ wkh iroorzlqj frqvwudlqhg vshflfdwlrq= q 5r 2 q 5rc 2 c5rc 3 2 c 5rc 32. { 5r 2 { 5rc 3 2. x 25r. 25r = +54, Vdujdq vwdwlvwlfv lqglfdwh wkdw ryhulghqwli lqj uhvwulfwlrqv fdqqrw eh uhmhfwhg dw dq uhdvrqdeoh ohyho ri vljqlfdqfh1 Dv iru sodqw vl}h/ wkh rughu ri dxwrfruuhodwlrq lv htxdo wr 5lq uvw glhuhqfhv/ zklfk fruuhvsrqgv wr d prylqj dyhudjh ri rughu 4 zkhq wkh ghshqghqw yduldeoh lv lq ohyhov1 Zh fdq wkxv vdiho frqfoxgh wkdw wkh g qdplfv ri sodqw fuhdwlrqv dqg ghvwuxfwlrqv lv dovr fruuhfwo fdswxuhg e d prgho dvvxplqj udqgrp rvfloodwlrqv durxqg d wlph0ghshqghqw orqj0uxq wdujhw= q ua 2 c 5rc 3. { 5r 2. x 25r +55, 4 2 dqg wkh glhuhqfh ehwzhhq wkh dfwxdo qxpehu ri sodqwv dqg lwv orqj0whup wdujhw/ % q 5r q ua 5r / lv djdlq dq DUPD+4/4, surfhvv= % 25r 4 2 O = 4<

22 Wdeoh 8= Qxpehu ri sodqwv 0 G qdplf prgho c 5rc 3 3=374 E3. c 5 3=4<4 E b v 5 +4, +5, 3=43: E3fH gly 5 3=3;5 E D frps 5r 3=;4; E2 q 5rc 3 3=;5< E DS c 5rc 32 3=369 ED c 5c 3 3=54< E3Se v 5c 3 3=3<5 E2e og 5c 3 frps 5c 3 3=3;9 E3eD 3=9<5 E3 S 3=375 E3 f 3=576 E HD 3=43; E3D 3=3<9 Eb 3=;64 E. 3=:43 E2.e Vdujdq 3=633 3=455 DF+4, 3=8:4 3=894 EÉ f 3D EÉ f 3D DF+5, 3=395 EÉ f 3D =38; EÉ f 3D DF+6, 3=334 Efb Rev =336 Ef. 53