Regional specialisation and industry location in the long run: Spain in the US mirror (1856-2002)
This paper studies the long-run pattern of regional specialisation in Spain for the period 1856–2002. We have obtained an inverted U-shape trend in manufacturing specialisation which is similar to that in the USA. Using a model that nests factor endowments and increasing returns, we find that both the latter influence manufacturing location, albeit with variations over time, factor endowments being the most decisive. Manufacturing industries intensive in agricultural and mining inputs are located near regions with these factor endowments, while human capital location gained importance from 1965 onwards. Being located near the market was also significant for some industries. The inverted U-shape observed in manufacturing specialisation is due to the fact that the importance of immobile factors increased regional specialisation. However, when mobile factors increased, as was the case with skilled labour, and when this factor converged across regions, specialisation decreased. The fact that the importance of central markets diminishing also contributed to this trend.
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Volume (Year): 5 (2011)
Issue (Month): 3 (October)
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