This Paper surveys the empirical literature on the economic geography of trade flows, factor prices, and the location of production. The discussion is structured around the empirical predictions of a canonical theoretical model. We review empirical evidence on the determinants of trade costs and...

A central prediction of a large class of theoretical models is that industry location is not necessarily uniquely determined by fundamentals. In these models, historical accident or expectations determine which of several steady-state locations is selected. Despite the theoretical prominence of...

This Paper develops a general test of factor price equalization that is robust to unobserved regional productivity differences, unobserved region-industry factor quality differences and variation in production technology across industries. We test relative factor price equalization across...

This paper estimates a structural model of economic geography using cross-country data on per capita income, bilateral trade, and the relative price of manufacturing goods. More than 70% of the variation in per capita income can be explained by the geography of access to markets and to sources...

This Paper investigates the determinants of countries’ export performance looking in particular at the role of international product market linkages. We begin with a novel decomposition of the growth in countries’ exports into the contribution from increases in external demand and from...

Do workers in countries located far from global economic activity have lower incentives to accumulate human capital than workers near the centre? This Paper models the relationship between countries’ distance from global economic activity, endogenous investments in education, and economic...