Growing in the Desert: A Comparative Analysis of Firms Located in EU Border Regions

• In Event: Firms and Banks

Abstract

Borders constitute a barrier that limits the development of the areas around them. In his location theory, Lösch (1944) goes as far as comparing these regions to deserts, where only smaller firms that suffice with reaching a smaller market potential settle. Although the Common Market in the EU along with the Schengen Area reduce market barriers that limit the development of border regions, these areas still face barriers, arising from physical geography and institutional differences between the two countries that the border separates. In this paper, we aim to use firm-level data to analyse whether the border effect penalizes the firms settled in border regions of the EU.

Author

• Jan Fidrmuc, U of Lille (France)