The Day After Covid-19: Implications for Growth, Specialization, and Inequality

Stefano Magrini and Alessandro Spiganti

No 2021:13, Working Papers from Department of Economics, University of Venice "Ca' Foscari"

Abstract: In the post-pandemic world, digital communication will be integral part of daily working to a higher extent than before, with a disproportionally strong impact on knowledge-based activities, like innovation and research. We present a multi-area endogenous growth model where abstract knowledge flows at no cost across space but tacit knowledge arises from the interaction between researchers and hence is hampered by distance. Digital communication reduces this "cost of distance" for flows of tacit knowledge and reinforces productive specialization. This increases the system-wide growth rate, but at the cost of an increase in inequality within and across areas.

Keywords: Agglomeration; videoconferencing; innovation; disparities (search for similar items in EconPapers)
JEL-codes: J24 O31 O41 R12 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2021
New Economics Papers: this item is included in nep-geo and nep-lma
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Persistent link: https://EconPapers.repec.org/RePEc:ven:wpaper:2021:13

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