Advance Production Duopolies and Posted Prices or Market-Clearing Prices

Robin Boadway (), Katherine Cuff () and Nicolas Marceau

Department of Economics Working Papers from McMaster University

Abstract: A two-region economy consists of a given but different number of immobile workers in each region, and a given number of mobile firms. Firms create jobs where they locate, but there is frictional unemployment. Two sorts of agglomeration effects arise: those from economies of scale in matching, and those from production economies external to the firm. Regions may either be part of a unitary state in which case all regional policies are decided by the central government, or they may be part of a federal state in which case some policies are determined by the regional governments. We characterize the resource allocations in both a unitary and a federal state, and identify the set of instruments that are required to replicate the social optimum in each state.

JEL-codes: H20 H70 J60 R30 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com, nep-geo, nep-pub and nep-ure
Date: 2002-08
View list of references

Downloads: (external link)
http://socserv.mcmaster.ca/econ/mceel/papers/KSDuopAllAug03.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:mcm:deptwp:2002-08

Access Statistics for this paper

More papers in Department of Economics Working Papers from McMaster University
Series data maintained by ().