Urban Agglomeration Economies in the U.S. Greenhouse and Nursery Production
Cheng, Mei-luan; Gomez, Miguel I.; Bills, Nelson L.
Greenhouse/nursery production in the U.S. has been highly concentrated in metropolitan areas. This paper examines the emergent, complex relationship between urban agglomeration and greenhouse/nursery production in the Northeast, Southeast and Pacific regions of the U.S. We use spatial econometric models to examine the effect of urbanization, spatial concentrations of firms, and firm-internal factors on greenhouse/nursery production levels. The analysis distinguishes the attributes of agglomeration forces stemming from urbanization economies and localization economies. Results suggest that the greenhouse/nursery sector may benefit from clustering among firms within the same sector. Also, greenhouse/nursery production levels are positively associated with population growth and the direct market access to consumers. The economic vibrancy of greenhouse/nursery businesses in densely populated areas would depend upon the capacity to adjust to increased land competition in metropolitan areas, while exploiting marketing opportunities offered by proximity to urban consumers.
WP 2011-18 October 2011JEL Classification Codes: R11; Q10; C21
Charles H. Dyson School of Applied Economics and Management, Cornell University