Working Paper: CEPR ID: DP17950
Authors: Alexander Klein
Abstract: This paper reviews research on spatial inequalities in the United States focusing on the Manufacturing Belt and Rust Belt. It offers a taxonomy of scholarship in this area and assesses its contribution to our understanding of the evolution of U.S. spatial inequalities since the middle of the nineteenth century. This scholarship has shown that the initial location of the Manufacturing Belt was influenced by natural resources, location of initial European settlements and early development of canals. The dominant position of the belt was the result of its large market potential which allowed firms to take advantage of agglomeration economies, supply-chain linkages and low-cost access to the consumers. Its decline and subsequent emergence of the Rust Belt was the result of rising labor costs and diminished location advantage.
Keywords: manufacturing belt; rust belt; economic geography; spatial inequality
JEL Codes: B20; R12; N61; N62; N91; N92
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| natural resources (Q30) | manufacturing belt (L69) |
| location of early European settlements (N93) | manufacturing belt (L69) |
| early development of canals (N91) | manufacturing belt (L69) |
| large market potential (D40) | manufacturing belt (L69) |
| agglomeration economies (R11) | manufacturing belt (L69) |
| rising labor costs (J39) | decline of manufacturing belt (O14) |
| diminished location advantages (R12) | decline of manufacturing belt (O14) |
| decline of manufacturing belt (O14) | outflow of manufacturing jobs (F66) |
| outflow of manufacturing jobs (F66) | regions with lower costs (R32) |