Working Paper: CEPR ID: DP10356
Authors: Kristian Behrens; Thophile Bougna; W Mark Brown
Abstract: We provide evidence for the effects of changes in transport costs, international trade exposure, and input-output linkages on the geographical concentration of Canadian manufacturing industries. Increasing transport costs, stronger import competition, and the spreading out of upstream suppliers and downstream customers are all strongly associated with declining geographical concentration of industries. The effects are large: changes in trucking rates, in import exposure, and in access to intermediate inputs explain between 20% and 60% of the observed decline in spatial concentration over the 1992?2008 period.
Keywords: Geographical concentration; Input-output linkages; International trade exposure; Transport costs; Trucking rates
JEL Codes: C23; L60; R12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| increasing trucking rates (L91) | decline in geographical concentration of Canadian manufacturing industries (N62) |
| stronger import competition (F69) | decline in geographical concentration of Canadian manufacturing industries (N62) |
| spreading out of upstream suppliers and downstream customers (L14) | decline in geographical concentration of Canadian manufacturing industries (N62) |
| changes in trucking rates and import exposure (F14) | decline in geographical concentration of Canadian manufacturing industries (N62) |