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Regional employment and wages. The effects of transport costs and market potential. An application for Argentina

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  • Pedro E. Moncarz

    (Universidad Nacional de Córdoba, Facultad de Ciencias Económicas, Instituto de Economía y Finanzas (Córdoba, Argentina))

Abstract

Economic activity in Argentina shows a high degree of concentration, in 1993 almost 46% of GDP was generated in an area representing just 0.14% of the country. When looking at the manufacturing sector the concentration is still higher. The new economic geography models developed since the early nineties explain the location of economic activity across regions as the result of two opposite forces, centripetal and centrifugal. As trade costs are reduced, the relative strength of these two forces changes, such that we might also expect changes in the regional structure of production and wages. How trade liberalising policies might have affected the structure of production and wages across regions is the topic we try to make a contribution. The evidence points out that the further reduction of trade barriers during the nineties might have had a small effect on the regional structure of employment and wages across counties, at least in the short-run. / La actividad económica en Argentina muestra un alto grado de concentración, en 1993 casi el 46% del PIB se generó en un área que representa sólo el 0,14% del país. Si se observa el sector manufacturero, la concentración es aún mayor. Los nuevos modelos de geografía económica desarrollados desde principios de los noventa explican la localización de la actividad económica en las regiones como el resultado de dos fuerzas opuestas, la centrípeta y la centrífuga. A medida que se reducen los costes del comercio, la fuerza relativa de estas dos fuerzas cambia, de modo que cabe esperar también cambios en la estructura regional de la producción y los salarios. La forma en que las políticas de liberalización del comercio pueden haber afectado a la estructura de la producción y los salarios en las distintas regiones es el tema al que intentamos contribuir. Los datos apuntan a que la mayor reducción de las barreras comerciales durante los años noventa podría haber tenido un pequeño efecto en la estructura regional del empleo y los salarios en los distintos países, al menos a corto plazo.

Suggested Citation

  • Pedro E. Moncarz, 2007. "Regional employment and wages. The effects of transport costs and market potential. An application for Argentina," Revista de Economía y Estadística, Universidad Nacional de Córdoba, Facultad de Ciencias Económicas, Instituto de Economía y Finanzas, vol. 45(1), pages 75-108, Junio.
    • Handle: RePEc:ief:reveye:v:45:y:2007:i:1:p:75-108
    DOI: 10.55444/2451.7321.2007.v45.n1.4384
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    References listed on IDEAS

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    1. Olga Alonso-Villar, 2001. "Large Metropolises in the Third World: An Explanation," Urban Studies, Urban Studies Journal Limited, vol. 38(8), pages 1359-1371, July.
    2. Marius Brülhart, 1998. "Economic Geography, Industry Location and Trade: The Evidence," The World Economy, Wiley Blackwell, vol. 21(6), pages 775-801, August.
    3. Steven Brakman & Harry Garretsen & Marc Schramm, 2000. "The Empirical Relevance of the New Economic Geography: Testing for a Spatial Wage Structure in Germany," CESifo Working Paper Series 395, CESifo.
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    Cited by:

    1. Peter Huber & Michael Pfaffermayr & Yvonne Wolfmayr, 2011. "Are There Border Effects in the EU Wage Function?," DANUBE: Law and Economics Review, European Association Comenius - EACO, issue 2, pages 23-41, June.

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    More about this item

    Keywords

    Economic geography; market potential; spatial agglomeration; increasing returns; transport costs;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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