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The Location of the UK Cotton Textiles Industry in 1838: a Quantitative Analysis

  • Crafts, Nicholas

    (University of Warwick)

  • Wolf, Nikolaus

    (Humboldt University)

We examine the geography of cotton textiles in Britain in 1838 to test claims about why the industry came to be so heavily concentrated in Lancashire. Our analysis considers both first and second nature aspects of geography including the availability of water power, humidity, coal prices, market access and sunk costs. We show that some of these characteristics have substantial explanatory power. Moreover, we exploit the change from water to steam power to show that the persistent effect of first nature characteristics on industry location can be explained by a combination of sunk costs and agglomeration effects.

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File URL: http://www2.warwick.ac.uk/fac/soc/economics/research/centres/cage/research/wpfeed/148-2013_crafts.pdf
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Paper provided by Competitive Advantage in the Global Economy (CAGE) in its series CAGE Online Working Paper Series with number 148.

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Date of creation: 2013
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Handle: RePEc:cge:wacage:148
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Web page: http://www2.warwick.ac.uk/fac/soc/economics/research/centres/cage/

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  1. Sascha O. Becker & Karolina Ekholm & Robert Jäckle & Marc-Andreas Mündler, 2005. "Location Choice and Employment Decisions: A Comparison of German and Swedish Multinationals," Kiel Working Papers 1243, Kiel Institute for the World Economy.
  2. 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.
  3. Head, Keith & Mayer, Thierry, 2006. "Regional wage and employment responses to market potential in the EU," Regional Science and Urban Economics, Elsevier, vol. 36(5), pages 573-594, September.
  4. Marc J. Melitz & Stephen J. Redding, 2012. "Heterogeneous firms and trade," LSE Research Online Documents on Economics 48928, London School of Economics and Political Science, LSE Library.
  5. Ros S, Joan R., 2003. "Why Isn't the Whole of Spain Industrialized? New Economic Geography and Early Industrialization, 1797 1910," The Journal of Economic History, Cambridge University Press, vol. 63(04), pages 995-1022, December.
  6. Brülhart, Marius & Schmidheiny, Kurt, 2009. "On the Equivalence of Location Choice Models: Conditional Logit, Nested Logit and Poisson," CEPR Discussion Papers 7379, C.E.P.R. Discussion Papers.
  7. Miren Lafourcade & Jacques-François Thisse, 2008. "New economic geography: A guide to transport analysis," PSE Working Papers halshs-00586878, HAL.
  8. Acemoglu, Daron, 1997. "Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality," CEPR Discussion Papers 1707, C.E.P.R. Discussion Papers.
  9. Peter Solar & John Lyons, 2011. "The English cotton spinning industry, 1780-1840, as revealed in the columns of the London Gazette," Business History, Taylor & Francis Journals, vol. 53(3), pages 302-323.
  10. Keith Head & Thierry Mayer, 2004. "Market Potential and the Location of Japanese Firms in the European Union," Sciences Po publications info:hdl:2441/10192, Sciences Po.
  11. Paul Krugman, 1990. "Increasing Returns and Economic Geography," NBER Working Papers 3275, National Bureau of Economic Research, Inc.
  12. Keith Head & Thierry Mayer, 2004. "Market Potential and the Location of Japanese Investment in the European Union," The Review of Economics and Statistics, MIT Press, vol. 86(4), pages 959-972, November.
  13. Paulo Guimar�es & Octávio Figueirdo & Douglas Woodward, 2003. "A Tractable Approach to the Firm Location Decision Problem," The Review of Economics and Statistics, MIT Press, vol. 85(1), pages 201-204, February.
  14. Theo Balderston, 2010. "The economics of abundance: coal and cotton in Lancashire and the world," Economic History Review, Economic History Society, vol. 63(3), pages 569-590, 08.
  15. repec:cup:cbooks:9780521868273 is not listed on IDEAS
  16. repec:hal:wpaper:halshs-00586878 is not listed on IDEAS
  17. repec:cup:cbooks:9780521687850 is not listed on IDEAS
  18. Tim Leunig, 2003. "A British industrial success: productivity in the Lancashire and New England cotton spinning industries a century ago," LSE Research Online Documents on Economics 494, London School of Economics and Political Science, LSE Library.
  19. repec:spo:wpecon:info:hdl:2441/10192 is not listed on IDEAS
  20. Motta, Massimo & Thisse, Jacques-Francois, 1994. "Does environmental dumping lead to delocation?," European Economic Review, Elsevier, vol. 38(3-4), pages 563-576, April.
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