On the relative importance of agglomeration economies in the location of FDI across British regions

Jonathan Jones and Colin Wren

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: The paper examines the relative importance for industrial location of production linkages and knowledge spillovers, distinguishing between intermediate and non-intermediate goods that are backwards or forwards in nature. A novel approach is used to construct proxies for non-intermediate goods at a sub-national industry level based on an Input-Output transaction table. Taking data on location decisions by foreign-owned plants across British regions over 1985-2007, the paper finds support for the new economic geography explanation of location based on linkages over that due to spillovers. However, the importance of intermediate and non-intermediate linkages differs between manufacturing and service industries.

Keywords: industrial location; agglomeration economies; intermediate goods; FDI (search for similar items in EconPapers)
JEL-codes: H3 L2 O2 R3 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2011-08
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:58526

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