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Integration and Transition: Scenarios for Location of Production and Trade in Europe


  • Forslid, R.
  • Haaland, J.I.
  • Knarvik, K.H.M.
  • Maestad, O.


Applying a newly developed CGE-model, we present scenarios for the future economic geography of Europe. The model divides the world into ten regions, of which five are European, and there are 14 industries, of which 12 are imperfectly competitive. With a complete input-output structure, the model captures comparative advantage mechanisms as well as intra-industry trade and "new economic geography" agglomeration forces. The simulations focus on successful transformation in Eastern Europe, and on further European or global integration. The results indicate that both transformation and European integration are of great importance for Estern Europe, while the effects for other European regions are moderate.

Suggested Citation

  • Forslid, R. & Haaland, J.I. & Knarvik, K.H.M. & Maestad, O., 1999. "Integration and Transition: Scenarios for Location of Production and Trade in Europe," Papers 13/99, Norwegian School of Economics and Business Administration-.
  • Handle: RePEc:fth:norgee:13/99

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    References listed on IDEAS

    1. Jean-Jacques Laffont & Jean Tirole, 1993. "A Theory of Incentives in Procurement and Regulation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121743, January.
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    Cited by:

    1. Maryla Maliszewska, 2004. "EU Enlargement: Benefits of the Single Market Expansion for Current and New Member States," CASE Network Studies and Analyses 0273, CASE-Center for Social and Economic Research.
    2. repec:dau:papers:123456789/1859 is not listed on IDEAS
    3. Forslid, Rikard & Haaland, Jan I. & Midelfart Knarvik, Karen Helene, 2002. "A U-shaped Europe?: A simulation study of industrial location," Journal of International Economics, Elsevier, vol. 57(2), pages 273-297, August.
    4. Andreea Vass, 2005. "Romania and the trade and the development approaches to CEE convergence with the EU, under the competitive pressures of integration," IWE Working Papers 151, Institute for World Economics - Centre for Economic and Regional Studies- Hungarian Academy of Sciences.
    5. Marius Brülhart & Matthieu Crozet & Pamina Koenig, 2004. "Enlargement and the EU Periphery: The Impact of Changing Market Potential," The World Economy, Wiley Blackwell, vol. 27(6), pages 853-875, June.

    More about this item



    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • F15 - International Economics - - Trade - - - Economic Integration
    • E66 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General Outlook and Conditions


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