Skip to main content
Article thumbnail
Location of Repository

FACTOR PRICE EQUALISATION IN THE UK?

By Andrew B. Bernard, Stephen Redding, Peter K. Schott and Helen SimpsonAndrew B. Bernard, Stephen Redding, Peter K. Schott and Helen Simpson

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

Topics: Relative Factor Prices, Diversification Cones, Technology, Economic Geography JEL classification, F11
Year: 2002
OAI identifier: oai:CiteSeerX.psu:10.1.1.198.6128
Provided by: CiteSeerX
Download PDF:
Sorry, we are unable to provide the full text but you may find it at the following location(s):
  • http://citeseerx.ist.psu.edu/v... (external link)
  • http://www.ifs.org.uk/workingp... (external link)
  • Suggested articles


    To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.