DP7017 The Rise and Fall of Spatial Inequalities in France: a Long-Run Perspective

Author(s): Pierre-Philippe Combes , Miren Lafourcade , Jacques-François Thisse , Jean-Claude Toutain

Publication Date: October 2008

Keyword(s): economic geography , agglomeration economies , human capital , economic history

JEL(s): N93 , N94 , O18 , R12

Programme Areas: International Trade and Regional Economics

Link to this Page: www.cepr.org/pubs/dps/DP7017.asp.asp

This paper uses a unique database that provides value-added, employment, and population levels for the entire set of French departments for the years 1860, 1930, and 2000. These data cover three sectors: agriculture, manufacturing, and services. This allows us to study the evolution of spatial inequalities within France and to test the empirical relevance of economic geography predictions over the long run. The evidence confirms the existence of a bell-shaped evolution of the spatial concentration of manufacturing and services. In contrast, labor productivity has been converging across departments. Last, our study also confirms the presence of strong agglomeration economies during the full time-period. Market potential during the first sub-period (1860-1930), and higher education during the second (1930-2000), together with sectoral diversity, account for the spatial distribution of these gains.