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Knowledge–capital meets new economic geography

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Abstract

This paper introduces multinational firms in a new economic geography model. There, unskilled labor mobility leads to less concentration of production than skilled labor mobility does. This is in line with empirical evidence that agglomeration of production in Europe is less pronounced than in the United States. The different patterns in (skilled versus unskilled) labor mobility together with the presence of multinational firms form one explanation of the actual differences in the spreading of industries in Europe as compared to the US

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Authors and Affiliations

  1. Ifo Institute for Economic Research and University of Munich, Poschingerstrasse 5, 81679, Munich, Germany

    Peter Egger & Mario Larch

  2. Faculty of Economics and Statistics, University of Innsbruck, Universitätsstraße 15, 6020, Innsbruck, Austria

    Stefan Gruber & Michael Pfaffermayr

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  1. Peter Egger
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  2. Stefan Gruber
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  3. Mario Larch
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  4. Michael Pfaffermayr
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Correspondence to Peter Egger.

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Egger, P., Gruber, S., Larch, M. et al. Knowledge–capital meets new economic geography. Ann Reg Sci 41, 857–875 (2007). https://doi.org/10.1007/s00168-007-0129-3

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  • DOI: https://doi.org/10.1007/s00168-007-0129-3

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