Coagglomeration and growth

Using plant-level data for the Irish manufacturing sector over the period 1983-98, we study the coagglomeration of domestic plants and foreign multinationals in Ireland. To this end we make use of the index developed by Ellison and Glaeser (1997) and find coagglomeration to be important for a number of sectors. We further test for the impact of coagglomeration on domestic firms' employment growth using panel level data. Foreign presence as well as foreign employment density are found to be important determinants of employment growth over the period, especially for those sectors with a high degree of coagglomeration.