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

  • Crafts, Nicholas
  • Wolf, Nikolaus

We examine the geography of UK cotton textiles 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 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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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 9626.

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Date of creation: Sep 2013
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Handle: RePEc:cpr:ceprdp:9626
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  1. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-99, June.
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  3. Timothy Leunig, 2003. "A British industrial success: productivity in the Lancashire and New England cotton spinning industries a century ago," Economic History Review, Economic History Society, vol. 56(1), pages 90-117, 02.
  4. Becker, Sascha O. & Ekholm, Karolina & Jäckle, Robert & Mündler, Marc-Andreas, 2005. "Location choice and employment decisions: a comparison of German and Swedish multinationals," Discussion Paper Series 1: Economic Studies 2005,08, Deutsche Bundesbank, Research Centre.
  5. Kurt Schmidheiny & Marius Brülhart, 2009. "On the equivalence of location choice models: conditional logit, nested logit and poisson," Working Papers 2009/14, Institut d'Economia de Barcelona (IEB).
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  7. Melitz, Marc J & Redding, Stephen J., 2013. "Heterogeneous Firms and Trade," CEPR Discussion Papers 9317, C.E.P.R. Discussion Papers.
  8. Paulo Guimaraes & Octavio Figueiredo & Douglas Woodward, 2000. "A tractable approach to the firm location decision problem," NIMA Working Papers 2, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
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  10. Motta, Massimo & Thisse, Jacques-Francois, 1994. "Does environmental dumping lead to delocation?," European Economic Review, Elsevier, vol. 38(3-4), pages 563-576, April.
  11. Head, Keith & Mayer, Thierry, 2005. "Regional Wage and Employment Responses to Market Potential in the EU," CEPR Discussion Papers 4908, C.E.P.R. Discussion Papers.
  12. 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.
  13. 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.
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  15. 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.
  16. 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.
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  18. Miren Lafourcade & Jacques-François Thisse, 2008. "New economic geography: A guide to transport analysis," PSE Working Papers halshs-00586878, HAL.
  19. 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.
  20. 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.
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