THE SOURCES OF SECTORAL FLUCTUATIONS IN METROPOLITAN-AREAS

Employment growth rates for 25 industries in the Philadelphia metropolitan area are decomposed into national, industry, metropolitan, and idiosyncratic sources which are estimated from a semistructural vector autoregression. The standard shift-share model is shown to be a restricted version of this constructed system and that these restrictions are not, in fact, met. For nearly all industries, the idiosyncratic shock is found to account for most of the variation in growth rates. © 1993 Academic Press. All rights reserved.