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Does spatial proximity raise firm productivity? evidence from British manufacturing.

Harris, R. and Moffat, J. and Evenhuis, E. and Martin, R. and Pike, A. and Sunley, P. (2019) 'Does spatial proximity raise firm productivity? evidence from British manufacturing.', Cambridge journal of regions, economy and society., 12 (3). pp. 467-487.


The UK’s economy is one of the most regionally imbalanced in Europe. The government’s recent industrial strategy discusses various means of addressing this, one of which is the strengthening of existing clusters. Using plant-level indices of spatial proximity derived from postcode district data, this article investigates the extent of spatial concentration and its impact on total factor productivity in advanced manufacturing sectors in Great Britain. The results from estimation of production functions indicate that, in most advanced manufacturing sectors, spatial concentration has a negative impact on productivity in small plants and a positive effect in larger plants. Large plants likely benefit more from knowledge spillovers due to their higher levels of absorptive capacity.

Item Type:Article
Full text:(AM) Accepted Manuscript
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Publisher statement:This is a pre-copyedited, author-produced PDF of an article accepted for publication in Cambridge journal of regions, economy and society following peer review. The version of record Harris, R , Moffat, J, Evenhuis, E, Martin, R Pike, A & Peter Sunley (2019). Does Spatial Proximity Raise Firm Productivity? Evidence from British Manufacturing. Cambridge Journal of Regions, Economy and Society 12(3): 467-487 is available online at:
Date accepted:21 August 2019
Date deposited:27 August 2019
Date of first online publication:22 October 2019
Date first made open access:22 October 2021

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