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Trade and Economic Geography: The Impact of EEC Accession on the UK

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  • Overman, Henry G.
  • Winters, L. Alan

Abstract

This paper combines establishment level production data with international trade data by port to examine the impact of accession to the EEC on the spatial distribution of UK manufacturing. We use this data to test the predictions from economic geography models of how external trade affects the spatial distribution of employment. Our results suggest that accession changed the country-composition of UK trade and via the port-composition induced an exogenous shock to the economic environment in different locations. In line with theory, we find that better access to export markets and intermediate goods increase employment while increased import competition decreases employment.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5574.

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Date of creation: Mar 2006
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Handle: RePEc:cpr:ceprdp:5574

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Keywords: economic geography; EEC; UK manufacturing;

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  1. James R. Tybout, 2001. "Plant- and Firm-Level Evidence on "New" Trade Theories," NBER Working Papers 8418, National Bureau of Economic Research, Inc.
  2. Hanson, Gordon H, 1997. "Increasing Returns, Trade and the Regional Structure of Wages," Economic Journal, Royal Economic Society, vol. 107(440), pages 113-33, January.
  3. Henry G Overman & L Alan Winters, 2005. "The port geography of UK international trade," Environment and Planning A, Pion Ltd, London, vol. 37(10), pages 1751-1768, October.
  4. James R. Tybout, 2000. "Manufacturing Firms in Developing Countries: How Well Do They Do, and Why?," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 11-44, March.
  5. Fujita, M. & Thisse, J.-F., . "Economics of agglomeration," CORE Discussion Papers RP -1250, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  6. Hanson, Gordon H., 1998. "Regional adjustment to trade liberalization," Regional Science and Urban Economics, Elsevier, vol. 28(4), pages 419-444, July.
  7. Nina Pavcnik, 2000. "Trade Liberalization, Exit, and Productivity Improvements: Evidence from Chilean Plants," NBER Working Papers 7852, National Bureau of Economic Research, Inc.
  8. A G Hoare, 1977. "The geography of British exports," Environment and Planning A, Pion Ltd, London, vol. 9(2), pages 121-136, February.
  9. Ottaviano, Gianmarco & Thisse, Jacques-Francois, 2004. "Agglomeration and economic geography," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 58, pages 2563-2608 Elsevier.
  10. Hanson, Gordon H, 1996. "Localization Economies, Vertical Organization, and Trade," American Economic Review, American Economic Association, vol. 86(5), pages 1266-78, December.
  11. A G Hoare, 1988. "Geographical aspects of British overseas trade: a framework and a review," Environment and Planning A, Pion Ltd, London, vol. 20(10), pages 1345-1364, October.
  12. Raul Livas Elizondo & Paul Krugman, 1992. "Trade Policy and the Third World Metropolis," NBER Working Papers 4238, National Bureau of Economic Research, Inc.
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