The role that industrial agglomerations play in regional economic growth has been discussed in the fields of regional economics and urban economics, and the effect of industrial agglomeration on regional economy has been proven in a number of previous studies. In particular, almost all previous works of research attempted to explain the reasons behind industrial agglomeration and classify its effects. Industrial agglomeration effects are conceptually classified into localization and urbanization economies. Localization economies are those agglomeration effects that accrue to a group of firms that belong to the same industrial sector and are located at the same place. Urbanization economies are agglomeration effects that accrue to firms across various sectors. Previous research focused on understanding the effect of these industrial agglomerations by using regional data of various countries. Moreover, the existence of localization economies and urbanization economies has been established in many regions including Japan. However, this focus was narrowed down to grasping the impact of industrial agglomeration on the level of labor productivity; most of the previous research did not verify the extent to which industrial agglomeration had exerted influence on regional economic growth. Therefore, this study extends these previous studies on agglomeration economies, by using the Japanese prefecture-level data on industries. We estimate the impact of industrial agglomeration on economic growth in Japanese regions. By employing Japanese prefectural data for the period 1980-2005, we attempt to provide, on the basis of an estimated production function, sufficient clarification of the manner in which agglomeration accelerates economic growth in regions.