The dynamics of industrial concentration in the regions of the European Union

Abstract

The spatial distribution of manufacturing in the regions of the European Union over the period 1977-1999 is examined in this article, using a series of nonparametric instruments proposed within the framework of the economic growth literature. These enable us to overcome some of the methodological limitations of the studies of this issue that have appeared to date. The results obtained reveal an increase in geographic concentration in most industrial activities during the whole of the period considered, the relevance of which has been especially important coinciding with the progress made in the economic integration process currently underway in Europe. Indeed, the empirical evidence presented in this respect suggests that this trend will continue in the future. Additionally, the observed degree of intrasectoral mobility is relatively low. Nevertheless, these findings reveal that the probability of further growth or decline in a given sector within a particular region is greater in those areas with an intermediate presence of the sector in question. © 2006 Blackwell Publishing.