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Were the new economic geography forces for industry agglomeration and dispersion at work in the movement of industry in pre-1931 Britain where transport costs were falling? This paper examines the issue empirically using a general model that nests the Heckscher-Ohlin factor endowment with new economic geography models. The evidence suggests that while the location of pre-1931 British industry was mainly driven by the former, the scale economies aspect of the latter also played a role.

This paper estimates the effect of environmental regulation on industry location and compares it with other determinants of location such as agricultural, education and R&D country characteristics. The analysis is based on a general empirical trade model that captures the interaction between country and industry characteristics in determining industry location. The Johnson-Neyman technique is used to fully explicate the nature of the conditional interactions. The model is applied to data on 16 manufacturing industries from 13 European countries. The empirical results indicate that the pollution haven effect is present and that the relative strength of such an effect is of about the same magnitude as other determinants of industry location. A significant negative effect on industry location is observed only at relatively high levels of industry pollution intensity.

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This article explores the location of industry in pre-World War I Britain using a model that takes account both of factor endowment and also of New Economic Geography influences. Broadly speaking, the pattern of industrial location in this period was quite persistent and regional specialization changed little. The econometric results show that factor endowments had much stronger effects than proximity to markets, although the latter was an attraction for industries with large plant size. Overall, falling transport costs had relatively little effect on industrial location at a time when proximity to natural resources, notably coal, mattered most. he nineteenth-century British economy is often described in terms of a North-South divide. Regional specialization is usually explained in terms of endowments of coal and its attraction to the Victorian staple industries for which it was an important input because of steam power. 1 At least until the railway age, there were pronounced differences in coal prices in different localities, with the most expensive about six times the cheapest. 2 It is generally accepted that the basic pattern of industrial location was established during the canal era and not seriously disturbed by the advent of the railway. 3 Certainly, once established, industries benefited from external economies, but for mid-century, proximity to natural resources rather than to markets is the major theme in the literature. 4 At some point late in the nineteenth or early in the twentieth century a different rationale for industrial location started to emerge. Once electricity became available as an alternative source of power, industry had