%0 Journal Article %T The spatial selection of heterogeneous firms %+ Kobe University %+ Center of Operation Research and Econometrics [Louvain] (CORE) %+ Center for Research in Economic Analysis (CREA) %+ Paris-Jourdan Sciences Economiques (PSE) %+ Paris School of Economics (PSE) %+ Center for Economic Policy Research (CEPR) %A Okubo, Toshihiro %A Picard, Pierre %A Thisse, Jacques-François %< avec comité de lecture %@ 0022-1996 %J Journal of International Economics %I Elsevier %V 82 %N 2 %P 230-237 %8 2010-11 %D 2010 %R 10.1016/j.jinteco.2010.07.003 %K Firm heterogeneity %K Spatial selection %K Trade liberalization %K Economic geography %Z Humanities and Social Sciences/Economics and FinanceJournal articles %X We show that heterogeneous firms choose different locations in response to market integration. Specifically, decreasing trade costs lead to the gradual agglomeration of efficient firms in the larger country where they have access to a bigger pool of consumers. In contrast, high-cost firms seek protection against competition from efficient firms by locating in the smaller country. However, when the spatial separation of markets ceases to be a sufficient protection against foreign competition, high-cost firms choose to set up in the larger market. Hence, the relationship between economic integration and international productivity gap first increases and then decreases with market integration. %G English %L halshs-00754412 %U https://pjse.hal.science/halshs-00754412 %~ SHS %~ UNIV-PARIS1 %~ ENS-PARIS %~ ENPC %~ PJSE %~ PSE %~ CNRS %~ EHESS %~ INRA %~ AO-ECONOMIE %~ PARISTECH %~ PSL %~ AGREENIUM %~ INRAE %~ PSE-POST-PRINT %~ ENS-PSL