Abstract
Spatial issues have received renewed interest in economics following the development of the new economic geography. At the same time, there is a general concern that the process of European integration would lead to higher regional specialisation making regions more prone to adverse shocks and increasing adjustment costs in the case of a relocation of firms. In particular, the warning by Krugman (1993) to EMU participants to learn the “lessons of Massachusetts”, i.e. the need for a highly specialised region to have efficient adjustment mechanisms as a reaction to a shock to its leading sector when the nominal exchange rate is not available in a monetary union, has received major attention. He predicted that Europe, once it has completed a single market with a single currency, would soon have the same degree of regional specialisation as the US. While trade and specialisation is a basic theoretical concept in economics, which already Adam Smith identified as the main source of the wealth of nations, it is all the more surprising that the empirical evidence on spatial patterns of specialisation following the integration of economies is very scarce and inconclusive. Due to problems of data availability, this holds in particular for the regional, sub-national level in Europe. The objective of this paper is to provide some new empirical results on these issues.
Views expressed in the paper are exclusively those of the author and do not necessarily correspond to those of the European Commission, for whose Directorate-General for Economic and Financial Affairs the author is working. Comments and suggestions are very welcome and should be sent to martin.hallet@cec.eu.int.
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Hallet, M. (2002). Regional Specialisation and Concentration in the EU. In: Cuadrado-Roura, J.R., Parellada, M. (eds) Regional Convergence in the European Union. Advances in Spatial Science. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-662-04788-0_3
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DOI: https://doi.org/10.1007/978-3-662-04788-0_3
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