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Regional Integration and Internal Economic Geography - an Empirical Evaluation with Portuguese Data

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Author Info
Nuno Crespo
Maria Paula Fontoura
Abstract

The effects of the reduction of international trade costs on the internal economic geography of each country have been very scarcely studied in empirical terms. With data for Portugal since its adhesion to the European Union, we test the hypotheses put forward by the new economic geography concerning the evolution of the spatial concentration of the manufacturing industry as a whole and of the different industries individually considered. We consider alternative concentration concepts and data disaggregated both at the level of NUTS III (28 regions) and concelhos (275 regions). Results show a dispersion of total industry as a consequence of the reduction of international trade costs, in line with Krugman and Elizondo (1996)’s prediction. Individual industries show a similar tendency, in contrast with the theoretical hypothesis.

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Paper provided by Department of Economics at the School of Economics and Management (ISEG), Technical University of Lisbon. in its series Working Papers with number 2006/25.

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Date of creation: 2006
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Handle: RePEc:ise:isegwp:wp252006

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Postal: Department of Economics, School of Economics and Management (ISEG), Technical University of Lisbon, Rua do Quelhas 6, 1200-781 LISBON, PORTUGAL
Web page: http://www.iseg.utl.pt/departamentos/economia/

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Related research
Keywords: trade liberalization industrial location Portugal.

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Find related papers by JEL classification:
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
F15 - International Economics - - Trade - - - Economic Integration
R12 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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  2. P Krugman & A Venables, 1993. "Intergration," CEP Discussion Papers 0172, Centre for Economic Performance, LSE.
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  4. Monfort, Philippe & Nicolini, Rosella, 2000. "Regional Convergence and International Integration," Journal of Urban Economics, Elsevier, vol. 48(2), pages 286-306, September. [Downloadable!] (restricted)
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  7. Alberto F. Ades & Edward L. Glaeser, 1994. "Trade and Circuses: Explaining Urban Giants," NBER Working Papers 4715, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  8. Krugman, Paul & Elizondo, Raul Livas, 1996. "Trade policy and the Third World metropolis," Journal of Development Economics, Elsevier, vol. 49(1), pages 137-150, April. [Downloadable!] (restricted)
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  9. Midelfart-Knarvik, K.H. & Overman, H.G. & Redding, S.J. & Venables, A.J., 2000. "The Location of European Industry," European Economy - Economic Papers 142, Commission of the EC, Directorate-General for Economic and Financial Affairs (DG ECFIN).
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  12. Elisenda Paluzie, Jordi Pons, Daniel A. Tirado, 2001. "Regional Integration and Specialization Patterns in Spain," Regional Studies, Taylor and Francis Journals, vol. 35(4), pages 285-296, June. [Downloadable!] (restricted)
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  13. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-99, June. [Downloadable!] (restricted)
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