productivity premium. Using a model of heterogeneous firms that can move between regions, Baldwin and Okubo (2006) show how more … intensive. As a result, our model can produce sorting to the large regions from both ends of the productivity distribution …. Firms with high capital intensity and high productivity as well as firms with very low productivity and low capital …

region productivity premium. Using a model of heterogeneous firms that can move between regions, Baldwin and Okubo (2006 … regions from both ends of the productivity distribution. Firms with high capital intensity and high productivity as well as … firms with very low productivity and low capital intensity tend to relocate to the core. We use Japanese micro data to …