We analyze determinants of regional industry mix and focus especially on the influence of labor market characteristics. By combining a labor market pooling argument with an argument involving the cost of switching a worker from one firm to another, we show that in the presence of product market...

We investigate the simultaneous impact of output and input market imperfections on the characteristics and size of regional economic activity. Firms, producing imperfect Substitutes, face product specific demand shocks which translate into firm-specific shocks. The more different the products...

We analyze the possibility and consequences of coalition-formation amongst suppliers of retail services. We first provide a framework in which producers of Substitutes have an incentive to Cluster in market places in order to attract consumers dispersed in space. Owing to spatial externalities,...