This paper provides causal evidence that inter-industry connections can influence the geographic location of economic activity. To do so, it takes advantage of a large, exogenous, temporary, and industry-specific shock to the 19th century British economy. The shock was caused by the U.S. Civil...

How do differences in the local business environment influence location of industry within countries? How do the benefits of a good business environment compare to those from good market access and agglomeration economies from industry clustering? We examine these questions by analyzing location...