Factor Price Equalization in the UK?

Andrew Bernard, Stephen Redding, Helen Simpson and Peter Schott

No 3523, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This Paper develops a general test of factor price equalization that is robust to unobserved regional productivity differences, unobserved region-industry factor quality differences and variation in production technology across industries. We test relative factor price equalization across regions of the UK. Although the UK is small and densely populated, we find evidence of statistically significant and economically important departures from relative factor price equalization. Our estimates suggest three distinct relative factor price areas with a clear spatial structure. We explore explanations for these findings, including multiple cones of diversification, region-industry technology differences, agglomeration, and increasing returns to scale.

Keywords: Relative factor prices; Diversification cones; Technology; Economic geography (search for similar items in EconPapers)
JEL-codes: C14 F11 F14 (search for similar items in EconPapers)
Date: 2002-08
New Economics Papers: this item is included in nep-geo
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
https://cepr.org/publications/DP3523 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Working Paper: Factor Price Equalization in the UK? (2003)
Working Paper: Factor Price Equalization in the UK? (2002)
Working Paper: Factor price equalization in the UK? (2002)
Working Paper: Factor price equalisation in the UK (2002)
Working Paper: Factor Price Equalization in the UK? (2002)
Working Paper: Factor Price Equalization in the UK? (2002)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:3523

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP3523

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().