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The cost of remoteness revisited

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  • Franke, Richard

Abstract

Redding and Sturm (2008) use the German division as a natural experiment to study the importance of market access for regional development. They show empirically that cities close to the East-West German border experienced a significant decline in population growth due to division. I argue that their results are driven by the internal migration of refugees in the 1950s rather than the loss of market access. In fact, the treatment effect estimated by Redding and Sturm (2008) disappears completely once the refugee share in 1950 and boundary changes of sample cities are taken into account.

Suggested Citation

  • Franke, Richard, 2017. "The cost of remoteness revisited," Kiel Working Papers 2070, Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwkwp:2070
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    References listed on IDEAS

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    1. Stephen J. Redding & Daniel M. Sturm & Nikolaus Wolf, 2011. "History and Industry Location: Evidence from German Airports," The Review of Economics and Statistics, MIT Press, vol. 93(3), pages 814-831, August.
    2. Gabriel M. Ahlfeldt & Stephen J. Redding & Daniel M. Sturm & Nikolaus Wolf, 2015. "The Economics of Density: Evidence From the Berlin Wall," Econometrica, Econometric Society, vol. 83, pages 2127-2189, November.
    3. Stephen J. Redding & Daniel M. Sturm, 2008. "The Costs of Remoteness: Evidence from German Division and Reunification," American Economic Review, American Economic Association, vol. 98(5), pages 1766-1797, December.
    4. Brülhart, Marius & Carrère, Céline & Trionfetti, Federico, 2012. "How wages and employment adjust to trade liberalization: Quasi-experimental evidence from Austria," Journal of International Economics, Elsevier, vol. 86(1), pages 68-81.
    5. Braun, Sebastian & Kvasnicka, Michael, 2014. "Immigration and structural change: Evidence from post-war Germany," Journal of International Economics, Elsevier, vol. 93(2), pages 253-269.
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    Cited by:

    1. Roesel Felix, 2023. "The German Local Population Database (GPOP), 1871 to 2019," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 243(3-4), pages 415-430, June.

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    More about this item

    Keywords

    Market Access; Regional Growth; Internal Migration;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • N94 - Economic History - - Regional and Urban History - - - Europe: 1913-
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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