Increasing Returns and the Spatial Structure of French Wages

New Economic Geography presents increasing returns to agglomeration as a central explanation for concentration of economic activity. The estimation of the size of these effects remains, however, a standing issue in the field. The focus of this study is to investigate the presence of increasing returns to agglomeration in the spatial structure of wages in France, using the methodology developed by Fingleton and initially used in the UK. The central finding is the statistically significant presence of such returns to density for France, as was the case for the UK in the original study. Compared to Fingleton's original work, it is shown that returns to density play a larger role in explaining French labour productivity, while commuting plays a smaller role than in the UK.