EconPapers    
Economics at your fingertips  
 

Why Cities Emerge and Grow? Explanations of Theoretical and Empirical Studies

Evgeniya Kolomak

Spatial Economics=Prostranstvennaya Ekonomika, 2018, issue 2, 134-153

Abstract: The article presents the results of theoretical and empirical studies devoted to looking into reasons of creation and success of the cities. The foundation of cities’ growth is the mechanisms of supporting spatial concentration of economic activity. The author studies two key elements of these processes in the framework of microeconomic theory: the increasing returns to scale and external agglomeration effects. Returns to scale are defined by technology, tied to the indivisibility and discretion of output, and are an internal factor not connected with external environment. Agglomeration economy looks into benefits of interacting with agents nearby. The advantages of cities and sources of their development are explained mainly by the agglomeration economy and externalities, divided into localization and urbanization effects. Several mechanisms of explaining city agglomeration economy can be highlighted: 1) distribution of risk; 2) shared usage of indivisible goods; 3) shared usage of a large market of various raw materials and production factors; 4) coordination of skills and work; 5) education, experimentation and accumulation of knowledge. Stability and growth of the cities is defined by combination of factors that have technological and institutional nature. The increasing returns to scale and external effects are supported and strengthened by the market mechanism. As a result, the cities have advantages in creation and shared usage of large output, in generation and distribution of innovations; use the benefits of a wide market, diversity and narrow specialization

Keywords: city; scale economy; agglomeration economy; sharing; distribution; matching; learning (search for similar items in EconPapers)
JEL-codes: O18 P25 R12 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.spatial-economics.com/images/spatial-ec ... .134-153.Kolomak.pdf (application/pdf)
http://spatial-economics.com/eng/arkhiv-nomerov/20 ... 46-SE-2018-2-134-153 (text/html)

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: https://EconPapers.repec.org/RePEc:far:spaeco:y:2018:i:2:p:134-153

DOI: 10.14530/se.2018.2.134-153

Access Statistics for this article

Spatial Economics=Prostranstvennaya Ekonomika is currently edited by Pavel Minakir

More articles in Spatial Economics=Prostranstvennaya Ekonomika from Economic Research Institute, Far Eastern Branch, Russian Academy of Sciences (Khabarovsk, Russia) Contact information at EDIRC.
Bibliographic data for series maintained by Sergey Rogov ().

 
Page updated 2019-07-23
Handle: RePEc:far:spaeco:y:2018:i:2:p:134-153