Production externalities and dispersion process in a multi-region economy

Minoru Osawa and Jos\'e M. Gaspar

Papers from arXiv.org

Abstract: We consider an economic geography model with two inter-regional proximity structures: one governing goods trade and the other governing production externalities across regions. We investigate how the introduction of the latter affects the timing of endogenous agglomeration and the spatial distribution of workers across regions. As transportation costs decline, the economy undergoes a progressive dispersion process. Mono-centric agglomeration emerges when inter-regional trade and/or production externalities incur high transportation costs, while uniform dispersion occurs when these costs become negligibly small (i.e., when distance dies). In multi-regional geography, the network structure of production externalities can determine the geographical distribution of workers as economic integration increases. If production externalities are governed solely by geographical distance, a mono-centric spatial distribution emerges in the form of suburbanization. However, if geographically distant pairs of regions are connected through tight production linkages, multi-centric spatial distribution can be sustainable.

Date: 2020-01, Revised 2021-05
New Economics Papers: this item is included in nep-geo, nep-net, nep-soc and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/2001.05095 Latest version (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: https://EconPapers.repec.org/RePEc:arx:papers:2001.05095

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().