Industrial Location and Economic Integration

Centrifugal and Centripetal Forces in the New Europe

Barbara Dluhosch, Institute for Economic Policy, University of the Federal Armed Forces, Germany

In recent decades the world economy has been characterized by deepening and widening integration. Throughout this time, there have been concerns that this process may foster the geographical concentration of industries, a view substantiated by contributions to the new economic geography. In this book, Barbara Dluhosch opposes this position and presents an entirely different view of the consequences of globalization.

‘This is an important and readable book that deserves to make significant impact on the European economic development debate.’
– Robert J. Bennett, Progress in Human Geography

‘. . . this book reveals a considerable amount of thoroughness and synthesis most of the available knowledge on convergence versus divergence within Europe. It opens appealing research avenues and I hope it will stimulate fruitful discussions among rural development and regional scientists.’
– Yves Léon, European Review of Agricultural Economics

‘The book is a valuable contribution to the most important economic event of the new millennium. The book offers refreshingly new insight to the different dimensions of the problems from such integration and, therefore, it is a must for researchers and policymakers.’
– Pradosh Nath, Journal of Scientific and Industrial Research

“芭芭拉到questi Dluhosch调用on the common wisdom – in vogue since the work of Helpman and Krugman – that economic integration always makes the big get better and the small go south. She arrays a number of powerful arguments, all with competition as a basic theme, that can reverse the centripetal force often presumed to dominate economic integration, even while remaining within an imperfect competition framework of analysis. Cost competition on the supply side drives firms to fragment production and spread these activities spatially, while increases in consumer choice raise effective elasticities on the demand side. The evidence presented on Europe is indeed supportive of the view that convergence, and not divergence, better characterizes economic integration there over the last three decades.’
– Michael Burda, Humboldt University of Berlin, Germany

‘This is an interesting and inspiring book. The main innovations of this study are the incorporation of the Lancastrian model of demand for commodity characteristics into the love-of-variety approach à la Dixit and Stiglitz and a non-conventional modelling of production technology. These modifications of existing models help to better understand and explain some of the phenomena that have been experienced in historical processes of integration. This study demonstrates possibilities to bridge existing gaps between traditional trade theory and the new economic geography . . . her approach is highly innovative, it produces new and interesting insights and paves a way for future research in this area.’
– Michael Rauscher, University of Rostock, Germany