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Factor Endowments and Production in European Regions

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  • Stephen Redding

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  • Mercedes Vera-Martin

Abstract

This paper analyses patterns of production across 14 industries in 45 regions from 7 European countries since 1975. We estimate a structural equation derived directly from Heckscher- Ohlin theory that relates an industry’s share of a region’s GDP to factor endowments and relative prices. Factor endowments are found to play a statistically significant and quantitatively important role in explaining production patterns. The explanation is most successful for aggregate industries, such as Agriculture, Manufacturing, and Services, and works less well for disaggregated industries within Manufacturing. We find no evidence that increasing European integration has weakened the relationship between factor endowments and production patterns within countries.

(This abstract was borrowed from another version of this item.)

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File URL: http://hdl.handle.net/10.1007/s10290-006-0055-y
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Bibliographic Info

Article provided by Springer in its journal Review of World Economics.

Volume (Year): 142 (2006)
Issue (Month): 1 (April)
Pages: 1-32

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Handle: RePEc:spr:weltar:v:142:y:2006:i:1:p:1-32

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Related research

Keywords: Factor endowments; Heckscher–Ohlin; neoclassical model; Europe;

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Cited by:
  1. Walker, Sarah, 2012. "The (Rail)road to Structural Change: Transportation Costs, Integration, and Production Specialization," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124614, Agricultural and Applied Economics Association.
  2. Néstor Duch, 2005. "Vertical linkages, agglomeration and the organization of production in European regions," Working Papers 2005/6, Institut d'Economia de Barcelona (IEB).

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