EU Enlargement and the Internal Geography of CountriesReport as inadecuate

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1 TEAM - Théories et Applications en Microéconomie et Macroéconomie 2 CREST - Centre de Recherche en Économie et Statistique

Abstract : This paper focuses on the relation between trade openness and the location of economicactivity in a country. The problematic lies in the context of the EU enlargement process and ofits impact on the location of economic activity inside each of the accessing countries. We develop a new economic geography model based on the original Krugman 1991 model, and show that trade liberalization will foster agglomeration of economic activity in the location that has the lowest-cost access to foreign markets. Our results thus differ from Krugman and Livas-s 1996 conclusions. We expect the CEECs- economies to shift economic activity towards EU markets. We provide empirical evidence of this result focusing on the post-1991 Romanian urban system.

keyword : economic integration urban concentration agglomeration CEECs

Author: Matthieu Crozet - Pamina Koenig -



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