The dynamics of industrial geographic distribution: evidence from Brazil (2002-2014)

Abstract

The geographical distribution of Brazilian industries changed between 2002 and 2014, and it was more significant for some industries. Based on Dumais et al. (2002), we explore the dynamics of these changes by a decomposition of the employment variation and concentration index for manufacturing industries grouped by technological intensity, and we identify the direction of the locational movements of the firms among microregions. In general., the results indicate that between 2002 and 2014, there was a trend of convergence among the microregions’ participation in industrial employment, contributing to industrial deconcentration in the country, with the exception of the group of high-technology industries, which became more concentrated. Components of the life cycle of industries, especially the growth of employment generated by new industries in non-metropolitan microregions, are identified as main propelling of this evidence. In general., the results are consistent with the importance of agglomeration economies over historic accidents to explain the industrial concentration in Brazil between 2002 and 2014.