The Impact of Diversification and Specialization on Employment Growth in Iranian Provinces



Urbanization agglomeration that is named Jacobs externalities, refers to the role of economic diversification in urban. Localization agglomeration, Marshal-Arrow-Romer (MAR) externalities, is related to the concentration of firms activated in a special industry within a specified place. The purpose of this research is to explore the impact of different types of agglomeration economies on employment growth for provinces of Iran in 1996-2006. Empirical results demonstrate a U-shaped relationship between specialization and urban growth We find a positive impact of Jacobs’s externalities on employment growth in provinces of Iran.
JEL Classification: O18, R11, R12, R15.