Geography and Intra-National Home Bias: U. S. Domestic Trade in 1949 and 2007

56 Pages Posted: 1 Feb 2013

See all articles by Nicholas Crafts

Nicholas Crafts

University of Warwick

Alexander Klein

University of Kent - Canterbury Campus

Date Written: January 2013

Abstract

This paper examines home bias in U. S. domestic trade in 1949 and 2007. We use a unique dataset of 1949 carload waybill statistics produced by the Interstate Commerce Commission and 2007 Commodity Flow Survey data. The results show that home bias was considerably smaller in 1949 than in 2007 and that home bias in 1949 was even negative for several commodities. We argue that the difference between the geographical distribution of manufacturing activities in 1949 and that of 2007 is an important factor explaining the differences in the magnitudes of home-bias estimates in those years.

Keywords: gravity equation, intra-national home bias, manufacturing belt, spatial clustering

JEL Classification: F14, N72

Suggested Citation

Crafts, Nicholas and Klein, Alexander, Geography and Intra-National Home Bias: U. S. Domestic Trade in 1949 and 2007 (January 2013). CEPR Discussion Paper No. DP9309. Available at SSRN: https://ssrn.com/abstract=2210280

Nicholas Crafts (Contact Author)

University of Warwick ( email )

Gibbet Hill Rd.
Coventry, West Midlands CV4 8UW
United Kingdom

Alexander Klein

University of Kent - Canterbury Campus ( email )

Keynes College
Canterbury, Kent CT2 7NP
United Kingdom

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