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Endowments, market potential, and industrial location: evidence from interwar Poland (1918-1939)

Wolf, Nikolaus (2004) Endowments, market potential, and industrial location: evidence from interwar Poland (1918-1939). CEPDP, 609. Centre for Economic Performance, London School of Economics and Political Science, London, UK. ISBN 0753017105

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Identification Number: 609

Abstract

The paper explores the determinants of industry location across interwar Poland. After more than 120 years of political and economic separation, Poland was reunified at the end of 1918. In consequence, its industry faced massive structural changes: the removal of internal tariff barriers and improved infrastructure strengthened the domestic market, while foreign market relations were cut off. Similarly, the geographical dispersion of factor endowments was changed through internal migration and new institutional arrangements (education system, patent laws, etc.). How did these forces interact to determine the location of industry? Did a new interregional division of labour emerge after unification? We survey the dynamics of industrial location between 1925 and 1937 and estimate a specification that nests market potential and comparative advantage to quantify their respective impact over time. The results point to a role for both, comparative advantage and market potential, but there was a dominating and ever increasing impact of the availability of skilled labour.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk
Additional Information: © 2004 Nikolaus Wolf
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HF Commerce
H Social Sciences > HD Industries. Land use. Labor
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Date Deposited: 28 Jul 2008 09:00
Last Modified: 01 Oct 2010 09:13
URI: http://eprints.lse.ac.uk/id/eprint/19992

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