The Bright Side of MAUP: an Enquiry on the Determinants of Industrial Agglomeration in the United States

Using county employment data for US and two appositely developed zoning algorithms, I compare the industrial concentration of manufacturing sectors calculated following the standard metropolitan and micropolitan statistical areas definition with two other counterfactuals, obtained by “gerrymandering” the original sample of counties. The methodology allows i) to obtain an unbiased estimate of industrial agglomeration which significantly improves on existing indices, and ii) to provide a ranking of industries according to their responsiveness to labour market determinants of agglomeration. Results show that labour market determinants explain one quarter of the variation of spatial agglomeration across industries.