Globalization, Industrial Policy and Clusters

Karen Helene Ulltveit-Moe and Rikard Forslid

No 3129, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This Paper analyses industrial policy in a high wage open economy hosting an agglomeration consisting of vertically linked upstream and downstream firms. We show that optimal policy towards upstream industries typically differ from the optimal policy towards downstream industries. Internationalization impacts on the costs as well as on the benefits related to sustaining an industrial agglomeration. Whether maintaining the agglomeration is compatible with a welfare maximizing policy is shown to depend on level of economic integration.

Keywords: Globalization; Industrial policy; Industrial clusters; Economic geography (search for similar items in EconPapers)
JEL-codes: F12 F15 F20 H20 R13 (search for similar items in EconPapers)
Date: 2002-01
New Economics Papers: this item is included in nep-geo
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Citations: View citations in EconPapers (1)

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Working Paper: Globalization, Industrial Policy and Clusters (2001)
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