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An analytically solvable core-periphery model

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Author Info
Rikard Forslid
Gianmarco I.P. Ottaviano

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Abstract

We develop an analytically solvable version of the central model of 'new economic geography', the so called core-periphery model by Krugman. While the modified model reproduces all the appealing features of the original one, it also allows us to obtain additional analytical results that are out of reach in Krugman's set-up. First, we are able to assess the exact number of equilibria and their global stability properties. Second, we are able to investigate the implications of exogenous asymmetries between countries. This is achieved by introducing heterogeneity between high-skill mobile and low-skill immobile workers, which may also be an empirically attractive property. Copyright 2003, Oxford University Press.

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Publisher Info
Article provided by Oxford University Press in its journal Journal of Economic Geography.

Volume (Year): 3 (2003)
Issue (Month): 3 (July)
Pages: 229-240
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Handle: RePEc:oup:jecgeo:v:3:y:2003:i:3:p:229-240

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  1. OTTAVIANO, Gianmarco & THISSE, Jacques-Franois, 2003. "Agglomeration and economic geography," CORE Discussion Papers 2003016, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
    Other versions:
  2. Borck, Rainald & Pflüger, Michael, 2004. "Agglomeration and Tax Competition," IZA Discussion Papers 1033, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  3. Gallo, Fredrik, 2005. "Determining the Level of Transportation Costs in the Core-Periphery Model: a Majority Voting Approach," Working Papers 2005:32, Lund University, Department of Economics.
  4. Pierre-Philippe Combes & Gilles Duranton & Henry Overman, 2005. "Agglomeration and the Adjustment of the Spatial Economy," CEP Discussion Papers dp0689, Centre for Economic Performance, LSE. [Downloadable!]
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  5. Pflüger, Michael P. & Tabuchi, Takatoshi, 2008. "Trade and Location with Land as a Productive Factor," IZA Discussion Papers 3716, Institute for the Study of Labor (IZA). [Downloadable!]
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  6. Carl Gaigné & Stéphane Riou, 2007. "Technical change and agglomeration," Economics Bulletin, Economics Bulletin, vol. 18(3), pages 1-5. [Downloadable!]
  7. Kristian Behrens & Yasuhiro Sato, 2006. "`Brain drain' without migration: Capital market integration and capital-skill complementarities," Economics Bulletin, Economics Bulletin, vol. 18(2), pages 1-9. [Downloadable!]
  8. Michael Pflüger & Jens Südekum, 2006. "Towards a Unifying Approach of the 'New Economic Geography'," IZA Discussion Papers 2256, Institute for the Study of Labor (IZA). [Downloadable!]
  9. Michael Pflüger, 2003. "A Simple, Analytically Solvable, Chamberlinian Agglomeration Model," Discussion Papers of DIW Berlin 339, DIW Berlin, German Institute for Economic Research. [Downloadable!]
  10. Takanori Ago & Ikumo Isono & Takatoshi Tabuchi, 2003. "Locational Disadvantage and Losses from Trade: Three Regions in Economic Geography," CIRJE F-Series CIRJE-F-224, CIRJE, Faculty of Economics, University of Tokyo. [Downloadable!]
  11. G. Rayp & B. Vanbergen, 2009. "Are social welfare states facing a race to the bottom? A theoretical perspective," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 09/572, Ghent University, Faculty of Economics and Business Administration. [Downloadable!]
  12. Jan Kranich, 2008. "R&D and the agglomeration of industries," Working Paper Series in Economics 83, University of Lüneburg, Institute of Economics. [Downloadable!]
  13. Calin Arcalean & Gerhard Glomm & Ioana Schiopu, 2007. "Growth Effects of Spatial Redistribution Policies," Caepr Working Papers 2007-002, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington. [Downloadable!]
  14. Rainald Borck & Michael Pflüger & Matthias Wrede, 2007. "A Simple Theory of Industry Location and Residence Choice," IZA Discussion Papers 2862, Institute for the Study of Labor (IZA). [Downloadable!]
  15. Jens Suedekum & Michael Pflueger, 2004. "Optimal agglomeration and regional policy," ERSA conference papers ersa04p341, European Regional Science Association. [Downloadable!]
  16. Gomes, Orlando, 2006. "Space, growth and technology: an integrated dynamic approach," MPRA Paper 2846, University Library of Munich, Germany. [Downloadable!]
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  17. Charles van Marrewijk, 2005. "General Geographical Economics Model with Congestion," Tinbergen Institute Discussion Papers 05-100/2, Tinbergen Institute. [Downloadable!]
  18. Richard E. Baldwin & Paul Krugman, 2002. "Agglomeration, Integration and Tax Harmonization," NBER Working Papers 9290, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  19. Candau, Fabien, 2006. "Good Governance, Trade and Agglomeration," MPRA Paper 2353, University Library of Munich, Germany. [Downloadable!]
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  20. Luca, Spinesi, 2005. "Vertical and Horizontal Innovation : Effects of Globalization and Migration on Inequality, Growth and Human Capital Accumulation," Discussion Papers (ECON - Département des Sciences Economiques) 2005028, Université catholique de Louvain, Département des Sciences Economiques. [Downloadable!]
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