What Explains the International Location of the Clothing Industry?
AbstractThe clothing sector has been a driver of diversification and growth for countries that have graduated into middle income. Using a partial adjustment panel data model, this study tries to explain the international location of clothing production based on a combination of variables suggested by the Heckscher-Ohlin theory and by New Economic Geography theory. Our Blundell-Bond system estimator results show that closeness to intermediates such as low-cost labor and textile production has a positive effect on clothing production. Factor endowment and closeness to the world market have inversed U-shaped effects. This is expected, because above a certain level several other sectors benefit even more from closeness and factor endowments, driving resources away from the clothing industry.
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Bibliographic InfoPaper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 290.
Length: 38 pages
Date of creation: 21 Feb 2008
Date of revision:
Contact details of provider:
Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/
More information through EDIRC
Clothing Industry; New Economic Geography; Comparative Advantages; Industrial Agglomeration.;
Find related papers by JEL classification:
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L67 - Industrial Organization - - Industry Studies: Manufacturing - - - Other Consumer Nondurables
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
- R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-02-23 (All new papers)
- NEP-DEV-2008-02-23 (Development)
- NEP-INT-2008-02-23 (International Trade)
- NEP-URE-2008-02-23 (Urban & Real Estate Economics)
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