Most FDI takes place between the developed countries, which suggests that the market-seeking motive is important for understanding FDI. However, given the stylized fact that trade barriers (e.g. transportation costs and financial barriers) have declined over the past 20 years, models that aim to...

By combining two large data sets (on international trade flows and on mergers and acquisitions – M&As), we are able to test two implications of Neary's (2003, 2004a) recent theoretical work. Analyzing M&As in a General Oligopolistic Equilibrium (GOLE) model incorporating strategic interaction...

Following the trade collapse in 2009, Globalization has recovered but the growth rate slowed down compared to the preceding period of Hyper Globalization. The persistence of this slowdown is remarkable. We argue that increased awareness of firms for the costs of involvement in global supply...

The research on the location choice for Foreign Direct Investment (FDI) is traditionally restricted to a choice between countries. The within-country location choice is less prominent in the literature. If within-country location decisions are considered it is mostly limited to Greenfield...

Following the trade collapse in 2009, Globalization has recovered but the growth rate slowed down compared to the preceding period of Hyper Globalization. The persistence of this slowdown is remarkable. We argue that increased awareness of firms for the costs of involvement in global supply...

In this paper we want to shed some light on the empirical relevance of the new economic geography. Using one of the central features of the core new economic geography models, namely that wages have the tendency to fall the further one moves away from centres of economic activity, we investigate...

With the completion of EMU, tax competition and, more in general, locational competition is high on the EU policy agenda. In contrast to the standard neo-classical reasoning, recent advances in the theory of trade and location have shown that tax competition does not necessarily lead to a race...

Many modern trade and growth models are characterized by multiple equilibria. In theory the analysis of multiple equilibria is possible, but in practice it is difficult to test for the presence of multiple equilibria. Based on the methodology developed by Davis and Weinstein (2004) for the case...

For reasons of analytical tractability, new economic geography (NEG) models treat geography in a very simple way: attention is either confined to a simple 2-region or to an equidistant multi-region world. As a result, the main predictions regarding the impact of e.g. diminishing trade costs are...

A key issue in development economics is the explanation of core-periphery patterns around the world. Combining this issue with that of analyzing unilateral transfers (e.g. foreign aid) points in the direction of the use of New Economic Geography (NEG) models which, so far, has not been done...