In this paper, we provide evidence based on New Economic Geography Models and estimate the statistical effects of second nature advantages to shed some light on the locational transformation of the manufacturing sector in Mexico. Changes in regional industry shares and regional wages during...

A basic result of new economic geography (NEG) models is that the proximity to consumer markets impacts wages and employment within regions. The ongoing process of European integration, being targeted on the reduction of barriers to trade and factor mobility, has presumably changed relative...