S-WoPEc
 
Scandinavian Working Papers in Economics
HomeAboutSeriesSubject/JEL codesAdvanced Search
Research Institute of Industrial Economics (IFN) Working Paper Series

No 504:
Trade and Location with Horizontal and Vertical Multi-Region Firms

Karolina Ekholm () and Rikard Forslid ()

Abstract: This paper analyses the effect on agglomeration tendencies of allowing firms to become multi-region firms in a standard model of trade and location. More specifically, we introduce horizontal and vertical multi-region firms into the core-periphery (CP) model developed by Krugman (1991). The introduction of horizontal multi-region firms dampens the strong agglomeration effects found in the CP model by making the range of trade costs for which the core-periphery equilibrium occurs smaller. The introduction of vertical multi-region firms that can separate the location of headquarter activities from the location of production has two counteracting effects. First, headquarters have a strong tendency to agglomerate, and, in this sence, agglomeration tendencies are strengthened. Second, actual production tends to be more spread out, and, in this sense, they are weakened.

Keywords: Trade; Location; Agglomeration; Multinational firms; (follow links to similar papers)

JEL-Codes: F12; F15; R12; (follow links to similar papers)

35 pages, October 1, 1998

Before downloading any of the electronic versions below you should read our statement on copyright.
Download GhostScript for viewing Postscript files and the Acrobat Reader for viewing and printing pdf files.

Full text versions of the paper:

iuiwop0504.pdf.zip    PDF-file (zipped) (73kB) 
iuiwop0504.pdf    PDF-file (86kB) 
iuiwop0504.ps.zip    PKZipped PostScript (92kB) 
iuiwop0504.ps    PostScript file (738kB) 
Files with additional material for the paper:
iuiwop0504.figures.pdf    Figures, PDF-file (330kB) 
iuiwop0504.figures.pdf.zip    Figures, PDF-file (zipped) (181kB) 
Download Statistics
This paper is forthcoming as:
Ekholm, Karolina and Rikard Forslid, 'Trade and Location with Horizontal and Vertical Multi-Region Firms', Scandinavian Journal of Economics.



Questions (including download problems) about the papers in this series should be directed to Elisabeth Gustafsson ()
Report other problems with accessing this service to Sune Karlsson () or Helena Lundin ().

Programing by
Design by Joachim Ekebom

Handle: RePEc:hhs:iuiwop:0504 This page was generated on 2014-12-14 19:24:06