Trends in European Manufacturing Location: Country versus Region
The purpose of this paper is to investigate whether and to what extent European manufacturing location has been driven by regional localisation or national comparative advantages during the period 1985-2001. To this end, the relative concentration pattern of each industry is disentangled into within and between country components. The original methodology adopted is based on the use of the Theil dissimilarity entropy index allowing to handle two geographical levels of analysis. The evidence suggests that the agglomeration of manufacturing industries is more likely to find expression between the internal regions of each country rather than across countries. Counterintuitively, after the completion of the Single European Market the relevance of national border remains stable or even increase in the localisation of the majority of the sectors considered.
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