The Effect of Trade on Agglomeration within Regions

Grace Carolina Guevara-Rosero ()
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Grace Carolina Guevara-Rosero: Departamento de Matemáticas, Facultad de Ciencias, Escuela Politécnica Nacional, Ecuador. University of Lyon, France.

Journal for Economic Forecasting, 2017, issue 1, 75-97

Abstract: This paper assesses for the first time the effect of regional trade openness on spatial distribution of population within regions by using a database on exports and imports of sub-national regions of Colombia from 1999 to 2010. Studies using such type of data are of significant relevance because the concentration in large cities of regions can be reinforced by trade. The results of our panel model show that the effect of trade on the spatial concentration of population depends upon the characteristics of regions. On the one hand, trade enhances the spatial agglomeration within regions with large home market and location advantages. On the other hand, trade induces dispersion within regions that lack access to international trade or historical disadvantage. These results hold when controlling for the natural course of agglomeration, congestion effects in cities, road infrastructure and historical factors.

Keywords: trade openness; spatial concentration; congestion; Economic Geography; regional data (search for similar items in EconPapers)
JEL-codes: F10 O54 R12 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:rjr:romjef:v::y:2017:i:1:p:75-97

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