Economics at your fingertips  

Elastic Labor Supply and Agglomeration

Takanori Ago, Tadashi Morita (), Takatoshi Tabuchi and Kazuhiro Yamamoto

Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: This study analyzes the interplay between the agglomeration of economic activities and interregional differences in working hours, which are typically longer in large cities, as normally they are more developed than small cities. For this purpose, we develop a two-region model with endogenous labor supply. Although we assume a symmetric distribution of immobile workers, the symmetric equilibrium breaks in the sense that firms may agglomerate when trade costs are intermediate and labor supply is elastic. We also show that the price index is always lower, while labor supply, per capita income, real wages, and welfare are always higher in the more agglomerated region.

Pages: 24 pages
Date: 2015-10
New Economics Papers: this item is included in nep-geo and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link) (application/pdf)

Related works:
Journal Article: Elastic labor supply and agglomeration (2018) Downloads
Working Paper: Elastic Labor Supply and Agglomeration (2017) Downloads
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:

Access Statistics for this paper

More papers in Discussion papers from Research Institute of Economy, Trade and Industry (RIETI) Contact information at EDIRC.
Bibliographic data for series maintained by TANIMOTO, Toko ().

Page updated 2021-06-12
Handle: RePEc:eti:dpaper:15118