Positive and negative agglomeration externalities: Arbitration in the pig sector

Solene S. Larue (1) , Jens Abildtrup (2) , Bertrand B. Schmitt (1)

1 CESAER - Centre d'Economie et de Sociologie Rurales Appliquées à l'Agriculture et aux Espaces Ruraux
2 LEF - Laboratoire d'Economie Forestière

In this study we analyse the determinants of pig production location in Denmark with a particular focus on positive and negative agglomeration externalities. Based on the theory of agglomeration and a discussion of the organization of the Danish pig production sector, a model of pig production is developed and tested empirically, applying the FG2SLS approach. Our results show that technical and pecuniary externalities have a positive effect on location, while the impact of environmental regulations is ambiguous. Indeed, the results show that urbanization economies are more important than the negative impact of land competition at the local level, but that neighbouring land competition implied by environmental regulations seems to have a negative effect on location.

Mots clés: AGGLOMERATION EXTERNALITIES; SPATIAL ECONOMETRICS; ENVIRONMENTAL REGULATION; LOCALISATION DES ACTIVITES

Domaines: Sciences agricoles

Solene S. Larue, Jens Abildtrup, Bertrand B. Schmitt. Positive and negative agglomeration externalities: Arbitration in the pig sector. Spatial Economic Analysis, 2011, 6 (2), pp.167-183. ⟨10.1080/17421772.2011.557773⟩. ⟨hal-01000477⟩