In this article, we test to what extent the Modifiable Areal Unit Problem (MAUP) moderates the effect of agglomeration externalities on areal sectoral employment growth by varying the initial geographical scale of analysis. Using spatial cross-regressive modelling, we find different effects of agglomeration forces across geographical scales. As the MAUP is a theoretical as well as a methodological problem, research should not only work with proper statistical specifications, but also relate this more explicitly to hypotheses concerning the geographical scale at which agglomeration externalities operate. .
Keywords: Agglomeration, employment growth, spatial econometrics, MAUP
Jel Code: C21, O18, R11, R12.