This paper estimates the agglomeration effects in France, Germany, Italy, Spain, and the UK, considering the endogeneity of spatial employment distribution and spatial fixed effects. The results suggest that agglomeration effects in these European countries are slightly lower than in the US, with an estimated elasticity of average labor productivity with respect to employment density of 4.5% compared to 5% in the US. The study combines spatial data on value-added with employment and education data at a detailed regional level (Nuts 3-regions) to estimate the relationship between employment density and productivity. The main challenges in estimating agglomeration effects include distinguishing between the causes and consequences of the positive correlation between agglomeration and productivity. The paper uses two approaches to address this issue: including variables that may explain spatial differences in total factor productivity and using an instrumental variable for regional employment density based on total land area. The empirical results indicate substantial agglomeration effects in the sample countries, with a doubling of employment density increasing average labor productivity by approximately 5%. The paper also discusses the impact of agricultural land use and spatial externalities across neighboring regions on productivity. Overall, the findings suggest that agglomeration effects do not vary significantly across countries.This paper estimates the agglomeration effects in France, Germany, Italy, Spain, and the UK, considering the endogeneity of spatial employment distribution and spatial fixed effects. The results suggest that agglomeration effects in these European countries are slightly lower than in the US, with an estimated elasticity of average labor productivity with respect to employment density of 4.5% compared to 5% in the US. The study combines spatial data on value-added with employment and education data at a detailed regional level (Nuts 3-regions) to estimate the relationship between employment density and productivity. The main challenges in estimating agglomeration effects include distinguishing between the causes and consequences of the positive correlation between agglomeration and productivity. The paper uses two approaches to address this issue: including variables that may explain spatial differences in total factor productivity and using an instrumental variable for regional employment density based on total land area. The empirical results indicate substantial agglomeration effects in the sample countries, with a doubling of employment density increasing average labor productivity by approximately 5%. The paper also discusses the impact of agricultural land use and spatial externalities across neighboring regions on productivity. Overall, the findings suggest that agglomeration effects do not vary significantly across countries.