Growth in small cities: the case of Aragon (Spain)

Abstract

In this paper, we analyse the effects of productive specialisation and diversity on population growth at the local level in Aragon, a NUTS 2 region in Spain. is region is characterised by a highly uneven population distribution, with numerous small cities, and a large proportion of small businesses. We estimate panel data models considering data from 2000 to 2015 at the local level, encompassing 577 municipalities. Our results show that both localisation and urbanisation have a statistically significant positive effect on growth in Aragonese municipalities but only in cities with a population threshold of 3,000 or more inhabitants.