The Spatial Spillover Impact of industrial Agglomeration on Manufacturing Employment in Iran's Provinces

The way of establishment of various economic activities, especially industrial activities, in a region can affect many economic variables such as production and employment. In this paper, the direct and spillover impact of industrial agglomeration on employment of manufacturing  sector in Iran's provinces are evaluated. For this purpose, while using the panel data of 31 provinces for the period 2015-2018, the spatial econometric model is estimated. The results of the estimation of the spatial Durbin model (SDM) with spatial fixed effects indicate that the manufacturing value added has a dicrect positive and significant impact on manufacturing employment  but a negative and significant spill-over impact onl employment. Also, the direct and spatial impacts of manufacturing investment is positive and significant. On the other hand, the direct impact of industrial concentration index on industrial employment is positive and significant. In addition, the results indicate that the spatial or spillover impact of the industrial agglomeration index on manufacturing  employment es is positive and significant.country's provinces has been positive and significant.