In this paper we analyse the role of agglomeration economies, classical demand and cost variables, as well as public infrastructures and human capital, in industrial investment location decisions in Spanish regions over the 1964-2000 period. Our results show that human capital and relative wages differences are the most important determinants in explaining the allocation of investment into new industrial settlements. Transport infrastructures and the rate of growth of wages also contribute to intensifying the use of capital, fundamentally in the regions with an important industrial tradition.

Key words: Location, industrial investment, regions.
JEL classification: E22, L60, R30.