History and industry location: evidence from German airports

Redding, Stephen J., Sturm, Daniel M. ORCID: 0000-0001-6408-8089 and Wolf, Nikolaus (2011) History and industry location: evidence from German airports. Review of Economics and Statistics, 93 (3). pp. 814-831. ISSN 0034-6535

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Abstract

A central prediction of a large class of theoretical models is that industry location is not uniquely determined by fundamentals. Despite the theoretical prominence of this idea, there is little systematic evidence in support of its empirical relevance. This paper exploits the division of Germany after World War II and the reunification of East and West Germany as an exogenous shock to industry location. Focusing on a particular economic activity, an air hub, we develop a body of evidence that the relocation of Germany's air hub from Berlin to Frankfurt in response to division is a shift between multiple steady states.

Item Type:	Article
Official URL:	http://www.mitpressjournals.org/loi/rest
Additional Information:	© 2011 MIT Press
Divisions:	Economics
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HD Industries. Land use. Labor
JEL classification:	F - International Economics > F1 - Trade > F14 - Country and Industry Studies of Trade F - International Economics > F1 - Trade > F15 - Economic Integration N - Economic History > N7 - Transport, International and Domestic Trade, Energy, Technology, and Other Services > N74 - Europe: 1913-
Date Deposited:	23 Feb 2012 15:03
Last Modified:	06 Nov 2024 06:39
URI:	http://eprints.lse.ac.uk/id/eprint/42019

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