Urban Hierarchy or Local Buzz? High-Order Producer Service and (or) Knowledge-Intensive Business Service Location in Canada, 1991-2001

Abstract

The location of high-order producer services has been extensively documented for the 1970s and 1980s when researchers turned their attention to the effects of tertiarization on regional development. In this article we propose, on the one hand, to update the spatial analysis of high-order producer services by investigating whether they have continued to diffuse away from the top of the urban hierarchy between 1991 and 2001. On the other hand, we also propose to incorporate certain hypotheses from the knowledge-intensive business services (KIBS) literature, in particular possible spillover effects, synergies between economic sectors and labor market effects, into the spatial analysis. Over and above city size, do these factors contribute to our understanding of the spatial dynamics of high-order producer services? Overall we find that these services reversed their diffusion process during the 1990s, decreasing their presence in smaller cities in peripheral regions. Labor market, synergies, and spillover effects contribute, to some extent, to understanding their overall spatial distribution and its evolution during the 1990s, but region and urban size remain their principal organizing factors across space.

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