This Paper estimates the agglomeration benefits that arise from vertical linkages between firms. The analysis is based … agglomeration benefits of the spatial variation in firm level nominal wages. Unusually detailed intermediate input data allow us to …

the quality of the match between job and worker, trade liberalization may lead to industrial agglomeration and inter …-industry trade. The agglomeration force is the improvement in the quality of matches when firms recruit from a bigger pool of labour …. The forces against agglomeration are the existence of trade costs and monopoly power in the labour market. We show that …