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Handling Market Imperfections in a Spatial Economy: Some Experimental Results II

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  • Eduardo A. Haddad

    ()

  • Geoffrey J. D. Hewings

    ()

Abstract

The Brazilian economy, with significant differencesin the distribution of economic activity acrossregions, presents a challenge to models that adopt aperfectly competitive market structure. This paperemploys an interregional CGE model of the Brazilianeconomy to explore the long-run impacts ofpositing changes in transportation structure andscale economies on regional and national welfare.In particular, the transportation cost structure ismodeled explicitly as a margin rather than in an icebergform; scale economies are addressed as a wayto mimic the imperfectly competitive structure ofthe Brazilian economy and to capture some of thepotential impacts of core-periphery relationshipsin production structure. This paper complementsa previous study by Haddad and Hewings (2005)that focused on the short-run implications of similarexperiments.

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Bibliographic Info

Article provided by BANCO DE LA REPÚBLICA - ESPE in its journal ENSAYOS SOBRE POLÍTICA ECONÓMICA.

Volume (Year): (2009)
Issue (Month): ()
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Handle: RePEc:col:000107:005846

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Keywords: interregional CGE model; transportationstructure; scale economies.;

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Cited by:
  1. Arguello, Ricardo, 2009. "The Regional Impact of Discriminatory Trade Liberalization on Colombian Agriculture," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 39(2).

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