Trade shocks and industrial location: the impact of EEC accession on the UK

Overman, Henry George ORCID: 0000-0002-3525-7629 and Winters, L. Alan (2003) Trade shocks and industrial location: the impact of EEC accession on the UK. CEP Discussion Papers (CEPDP0588). London School of Economics and Political Science. Centre for Economic Performance, London, UK.

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Abstract

This paper combines detailed production data (from the ARD) with international trade data by port to examine the impact of accession to the EEC on the location of UK manufacturing. The paper has two main objectives. The first is to test the implications of models of economic geography for the location of economic activity in a developed economy subject to a significant trade shock. The second is to shed new light on the implications of EEC accession for the UK economy. Our results suggest that accession did eventually encourage UK manufacturing to relocate towards the South-East but that within the aggregate some industries retreated north-westwards in the face of increased import competition. Methodologically we have found that proximity to the ports through which trade occurs is a proxy for export market access and import competition and thus helps to explain industrial location. We have also found that the port-composition of UK trade is partly determined by the country-composition of trade. UK accession changed the country-composition of UK trade and via the port-composition induced an exogenous shock to the relative degrees of export market access and import competition in different UK locations. Our results show that employment responded as predicted to these shocks.

Item Type:	Monograph (Discussion Paper)
Official URL:	https://cep.lse.ac.uk/_new/publications/discussion...
Additional Information:	© 2003 The Author(s)
Divisions:	Geography & Environment LSE
Subjects:	H Social Sciences > HC Economic History and Conditions
JEL classification:	F - International Economics > F1 - Trade > F15 - Economic Integration F - International Economics > F1 - Trade > F14 - Country and Industry Studies of Trade R - Urban, Rural, and Regional Economics > R1 - General Regional Economics > R12 - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade
Date Deposited:	29 Feb 2024 13:51
Last Modified:	14 Sep 2024 04:43
URI:	http://eprints.lse.ac.uk/id/eprint/121691

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