In recent years it has been pointed out that regional unemployment disparities are much more entrenched across member states of the European Union (E.U.) than they are in the U.S. A "conventional wisdom" has emerged to the effect that this difference is due in part to the greater degree of wage...

In this paper we want to shed some light on the empirical relevance of the new economic geography. Using one of the central features of the core new economic geography models, namely that wages have the tendency to fall the further one moves away from centres of economic activity, we investigate...