“…Although there is a strong consensus that the market-based process of economic integration is a positive-sum game increasing aggregate effi ciency (Heckscher, 1919(Heckscher, /1991Ohlin, 1933;Samuelson, 1949;Solow, 1956;Swan, 1956;Borjas, 1989;Greenwood et al, 1991), the allocation of overall welfare gains is a subject of debate (Amin et al, 1992;Gianneti, 2002;Guerrieri and Rossi, 2002;Melachroinos, 2002;Petrakos et al, 2005c). Higher levels of competition -especially imperfect competition -are deemed to result to an uneven distribution of the benefi ts of economic integration, increasing spatial imbalances (Lyons et al, 2001;Martin and Ottaviano, 2001;Ciccone, 2002;Brülhart and Elliott, 2004).…”