Regional distribution of foreign manufacturing investment in Spain. Do agglomeration economies matter?
The objective of this paper is to examine the nature and determinants of the regional distribution of FDI within Spain with special emphasis in agglomeration factors. Although the paper focuses in the manufacturing investment, considered a key factor in the economic transformation happened during the last 35 years, and traditionally the large part of FDI until the mid of eighties, the analysis distinguish between total FDI case and manufacturing FDI case. The paper is of interest for two main reasons: first this study introduces agglomeration and urbanization variables to test if they are decisive location factors. As it is showed in the part of description of the variables, there are very few studies of location determinants that consider new economic geography variables. In second tem, there are very few studies of location determinants of FDI in Spain, and even fewer that focus in regional areas. The precedent of this paper is another previous study, where the traditional cost and market determinants were empirically tested, a descriptive part of the work showed a high geographical concentration, so one possible explication could be that agglomeration and urbanization economies were decisive location factors. This study introduces some agglomeration and urbanization variables to test if they are decisive location factors in Spanish regions, distinguishing total FDI case and manufacturing FDI case. The article is divided into five further sections. The next section examines the location determinants of FDI and reviews the existing literature in regional/state location factors. The second section provides details on the database and the econometric methodology. In the forth section the empirical results are discussed. The final section offers a summary and concluding remarks.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Romer, Paul M, 1986.
"Increasing Returns and Long-run Growth,"
Journal of Political Economy,
University of Chicago Press, vol. 94(5), pages 1002-1037, October.
- Paul M Romer, 1999. "Increasing Returns and Long-Run Growth," Levine's Working Paper Archive 2232, David K. Levine.
- Bartik, Timothy J, 1985. "Business Location Decisions in the United States: Estimates of the Effects of Unionization, Taxes, and Other Characteristics of States," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(1), pages 14-22, January.
- Sergio Mariotti & Lucia Piscitello, 1995. "Information Costs and Location of FDIs within the Host Country: Empirical Evidence from Italy," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 26(4), pages 815-841, December.
- Bajo-Rubio, Oscar & López-Pueyo, Carmen, 2002. "Foreign Direct Investment in a Process of Economic Integration: The Case of Spanish Manufacturing, 1986-1992," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 17, pages 85-103.
- Oscar Bajo-Rubio & Carmen López-Pueyo, "undated". "Foreing Direct Investment in a Process of Economic Integration: The Case of Spanish Manufacturing, 1986-1992," Working Papers on International Economics and Finance 02-02, FEDEA.
- Oscar Bajo-Rubio & Carmen López-Pueyo, 2002. "Foreign Direct Investment in a Process of Economic Integration: The Case of Spanish Manufacturing, 1986-1992," Working Papers 02-02, Asociación Española de Economía y Finanzas Internacionales.
- Oscar Bajo-Rubio & Carmen LÛpez-Pueyo, "undated". "Foreign direct investment in a process of economic integration: The case of Spanish manufacturing, 1986-1992," Studies on the Spanish Economy 126, FEDEA.
- Coughlin, Cletus C & Terza, Joseph V & Arromdee, Vachira, 1991. "State Characteristics and the Location of Foreign Direct Investment within the United States," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 675-683, November.
- Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters,in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626 National Bureau of Economic Research, Inc.
- Caves, Richard E, 1971. "International Corporations: The Industrial Economics of Foreign Investment," Economica, London School of Economics and Political Science, vol. 38(149), pages 1-27, February.
- John H Dunning, 1998. "Location and the Multinational Enterprise: A Neglected Factor?," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 29(1), pages 45-66, March.
- Guimaraes, Paulo & Figueiredo, Octavio & Woodward, Douglas, 2000. "Agglomeration and the Location of Foreign Direct Investment in Portugal," Journal of Urban Economics, Elsevier, vol. 47(1), pages 115-135, January.
- Canfei He, 2002. "Information costs, agglomeration economies and the location of foreign direct investment in China1," Regional Studies, Taylor & Francis Journals, vol. 36(9), pages 1029-1036.
- M. Teresa Costa-Campi & Elisabet Viladecans-Marsal, 1999. "The District Effect and the Competitiveness of Manufacturing Companies in Local Productive Systems," Urban Studies, Urban Studies Journal Limited, vol. 36(12), pages 2085-2098, November.
- Joseph Friedman & Hung-Gay Fung & Daniel A. Gerlowski & Jonathan Silberman, 1996. "A Note on "State Characteristics and the Location of Foreign Direct Investment within the United States."," The Review of Economics and Statistics, MIT Press, vol. 78(2), pages 367-368, May.
- Carlton, Dennis W, 1983. "The Location and Employment Choices of New Firms: An Econometric Model with Discrete and Continuous Endogenous Variables," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 440-449, August.
- Culem, Claudy G., 1988. "The locational determinants of direct investments among industrialized countries," European Economic Review, Elsevier, vol. 32(4), pages 885-904, April.
- Head, C. Keith & Ries, John C. & Swenson, Deborah L., 1999. "Attracting foreign manufacturing: Investment promotion and agglomeration," Regional Science and Urban Economics, Elsevier, vol. 29(2), pages 197-218, March.
- Nigel Driffield & Max Munday, 2000. "Industrial Performance, Agglomeration, and Foreign Manufacturing Investment in the UK," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 31(1), pages 21-37, March.
- Thiran, Jean-Marc & Yamawaki, Hideki, 1995. "Regional and Country Determinants of Locational Decisions : Japanese Multinationals in European Manufacturing," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 1995017, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES). Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:wiw:wiwrsa:ersa04p682. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Gunther Maier)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.