Regional distribution of foreign manufacturing investment in Spain. Do agglomeration economies matter?
AbstractThe objective of this paper is to examine the nature and determinants of the regional distribution of FDI within Spain with special emphasis in agglomeration factors. Although the paper focuses in the manufacturing investment, considered a key factor in the economic transformation happened during the last 35 years, and traditionally the large part of FDI until the mid of eighties, the analysis distinguish between total FDI case and manufacturing FDI case. The paper is of interest for two main reasons: first this study introduces agglomeration and urbanization variables to test if they are decisive location factors. As it is showed in the part of description of the variables, there are very few studies of location determinants that consider new economic geography variables. In second tem, there are very few studies of location determinants of FDI in Spain, and even fewer that focus in regional areas. The precedent of this paper is another previous study, where the traditional cost and market determinants were empirically tested, a descriptive part of the work showed a high geographical concentration, so one possible explication could be that agglomeration and urbanization economies were decisive location factors. This study introduces some agglomeration and urbanization variables to test if they are decisive location factors in Spanish regions, distinguishing total FDI case and manufacturing FDI case. The article is divided into five further sections. The next section examines the location determinants of FDI and reviews the existing literature in regional/state location factors. The second section provides details on the database and the econometric methodology. In the forth section the empirical results are discussed. The final section offers a summary and concluding remarks.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by European Regional Science Association in its series ERSA conference papers with number ersa04p682.
Date of creation: Aug 2004
Date of revision:
Contact details of provider:
Postal: Welthandelsplatz 1, 1020 Vienna, Austria
Web page: http://www.ersa.org
Other versions of this item:
- Àngels Pelegrín, 2003. "Regional Distribution of Foreign Manufacturing Investment in Spain. Do Agglomeration Economies Matter?," Working Papers 2003/6, Institut d'Economia de Barcelona (IEB).
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-09-14 (All new papers)
- NEP-GEO-2005-11-21 (Economic Geography)
- NEP-URE-2005-12-28 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Culem, Claudy G., 1988. "The locational determinants of direct investments among industrialized countries," European Economic Review, Elsevier, vol. 32(4), pages 885-904, April.
- Head, C. Keith & Ries, John C. & Swenson, Deborah L., 1999. "Attracting foreign manufacturing: Investment promotion and agglomeration," Regional Science and Urban Economics, Elsevier, vol. 29(2), pages 197-218, March.
- Joseph Friedman & Hung-Gay Fung & Daniel A. Gerlowski & Jonathan Silberman, 1996. "A Note on "State Characteristics and the Location of Foreign Direct Investment within the United States."," The Review of Economics and Statistics, MIT Press, vol. 78(2), pages 367-68, May.
- Guimaraes, Paulo & Figueiredo, Octavio & Woodward, Douglas, 2000. "Agglomeration and the Location of Foreign Direct Investment in Portugal," Journal of Urban Economics, Elsevier, vol. 47(1), pages 115-135, January.
- Caves, Richard E, 1971. "International Corporations: The Industrial Economics of Foreign Investment," Economica, London School of Economics and Political Science, vol. 38(149), pages 1-27, February.
- Paul M Romer, 1999.
"Increasing Returns and Long-Run Growth,"
Levine's Working Paper Archive
2232, David K. Levine.
- John H Dunning, 1998. "Location and the Multinational Enterprise: A Neglected Factor?," Journal of International Business Studies, Palgrave Macmillan, vol. 29(1), pages 45-66, March.
- Bajo-Rubio, Oscar & López-Pueyo, Carmen, 2002.
"Foreign Direct Investment in a Process of Economic Integration: The Case of Spanish Manufacturing, 1986-1992,"
Journal of Economic Integration,
Center for Economic Integration, Sejong University, vol. 17, pages 85-103.
- Oscar Bajo-Rubio & Carmen López-Pueyo, . "Foreing Direct Investment in a Process of Economic Integration: The Case of Spanish Manufacturing, 1986-1992," Working Papers on International Economics and Finance 02-02, FEDEA.
- Oscar Bajo-Rubio & Carmen López-Pueyo, . "Foreign direct investment in a process of economic integration: The case of Spanish manufacturing, 1986-1992," Studies on the Spanish Economy 126, FEDEA.
- Oscar Bajo-Rubio & Carmen López-Pueyo, 2002. "Foreign Direct Investment in a Process of Economic Integration: The Case of Spanish Manufacturing, 1986-1992," Working Papers 02-02, Asociación Española de Economía y Finanzas Internacionales.
- Bartik, Timothy J, 1985. "Business Location Decisions in the United States: Estimates of the Effects of Unionization, Taxes, and Other Characteristics of States," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(1), pages 14-22, January.
- Carlton, Dennis W, 1983. "The Location and Employment Choices of New Firms: An Econometric Model with Discrete and Continuous Endogenous Variables," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 440-49, August.
- Nigel Driffield & Max Munday, 2000. "Industrial Performance, Agglomeration, and Foreign Manufacturing Investment in the UK," Journal of International Business Studies, Palgrave Macmillan, vol. 31(1), pages 21-37, March.
- Sergio Mariotti & Lucia Piscitello, 1995. "Information Costs and Location of FDIs within the Host Country: Empirical Evidence from Italy," Journal of International Business Studies, Palgrave Macmillan, vol. 26(4), pages 815-841, December.
- Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters, in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626 National Bureau of Economic Research, Inc.
- Coughlin, Cletus C & Terza, Joseph V & Arromdee, Vachira, 1991. "State Characteristics and the Location of Foreign Direct Investment within the United States," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 675-83, November.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Gunther Maier).
If references are entirely missing, you can add them using this form.