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New economic geography meets Comecon

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  • Marius Brülhart
  • Pamina Koenig

Abstract

We analyse the internal spatial wage and employment structures of the Czech Republic, Hungary, Poland, Slovakia and Slovenia, using regional data for 1996-2000. A new economic geography model predicts wage gradients and specialization patterns that are smoothly related to the regions' relative market access. As an alternative, we formulate a 'Comecon hypothesis', according to which wages and sectoral location are not systematically related to market access except for discrete concentrations in capital regions. Estimations support both the NEG (new economic geography) prediction and the Comecon hypothesis. However, when we compare internal wage and employment gradients of the five new member states with those of Western European countries, we find that the former are marked by significantly stronger discrete concentrations of wages and service employment in their capital regions, confirming the ongoing relevance of the Comecon hypothesis. Copyright (c) The European Bank for Reconstruction and Development, 2006.

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Bibliographic Info

Article provided by The European Bank for Reconstruction and Development in its journal Economics of Transition.

Volume (Year): 14 (2006)
Issue (Month): 2 (04)
Pages: 245-267

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Handle: RePEc:bla:etrans:v:14:y:2006:i:2:p:245-267

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Cited by:
  1. Tripathi, Sabyasachi, 2012. "Do large agglomerations lead to economic growth? evidence from urban India," MPRA Paper 38227, University Library of Munich, Germany.
  2. Partridge, Mark D. & Rickman, Dan S., 2012. "Integrating regional economic development analysis and land use economics," MPRA Paper 38291, University Library of Munich, Germany.
  3. Maria Florencia Granato, 2011. "REGIONAL NEW ECONOMIC GEOGRAPHY (refereed paper)," ERSA conference papers ersa10p747, European Regional Science Association.
  4. Partridge, Mark D. & Rickman, Dan S. & Ali, Kamar & Olfert, M. Rose, 2009. "Agglomeration spillovers and wage and housing cost gradients across the urban hierarchy," Journal of International Economics, Elsevier, vol. 78(1), pages 126-140, June.

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