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To Migrate or to Commute?

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  • Stefan Gruber

    (UMIT - Institute for Health Economics and Management, RCEA and Austrian Center for Labor Economics and the Analysis of the Welfare State)

Abstract

In this paper, we investigate the agglomeration patterns in a New Economic Geography model when commuting is allowed. The introduction of both commuting and housing costs leads to a disentangling of the agglomeration of firms and people. Commuting al- lows workers to continue living in agglomerations and enjoying the benefits of a larger product variety, despite high housing costs, since they may choose to commute to another place where they receive higher wages, which in turn enables them to cover high housing costs at their place of living. This observation is especially true for skilled workers, who generally are more mobile than unskilled workers.

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Bibliographic Info

Article provided by Rimini Centre for Economic Analysis in its journal Review of Economic Analysis.

Volume (Year): 2 (2010)
Issue (Month): 1 (January)
Pages: 110-134

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Handle: RePEc:ren:journl:v:2:y:2010:i:1:p:110-134

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Related research

Keywords: New Economic Geography; Commuting; Mobility of workers; Commuting costs; Housing costs;

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References

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  1. OTTAVIANO, Gianmarco & THISSE, Jacques-François, 1999. "Agglomeration and trade revisited," CORE Discussion Papers 1999041, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  2. Alex Anas, 2003. "Vanishing Cities: What Does the New Economic Geography Imply About the Efficiency of Urbanization?," Urban/Regional 0302005, EconWPA.
  3. Takatoshi Tabuchi & Jacques-François Thisse, 2006. "Regional Specialization, Urban Hierarchy, And Commuting Costs," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 47(4), pages 1295-1317, November.
  4. Edward Glaeser & Janet Kohlhase, 2003. "Cities, regions and the decline of transport costs," Papers in Regional Science, Springer, vol. 83(1), pages 197-228, October.
  5. Baier, Scott L. & Bergstrand, Jeffrey H., 2001. "The growth of world trade: tariffs, transport costs, and income similarity," Journal of International Economics, Elsevier, vol. 53(1), pages 1-27, February.
  6. Stefan Gruber & Luigi Marattin, 2010. "Taxation, infrastructure and endogenous trade costs in new economic geography," Papers in Regional Science, Wiley Blackwell, vol. 89(1), pages 203-222, 03.
  7. Cameron, Gavin & Muellbauer, John, 1998. "The Housing Market and Regional Commuting and Migration Choices," Scottish Journal of Political Economy, Scottish Economic Society, vol. 45(4), pages 420-46, September.
  8. Shields, Gail M & Shields, Michael P, 1989. " The Emergence of Migration Theory and a Suggested New Direction," Journal of Economic Surveys, Wiley Blackwell, vol. 3(4), pages 277-304.
  9. Yasusada, MURATA & Jacques-François, THISSE, 2004. "A simple model of economic geography à la Helpman-Tabuchi," Discussion Papers (ECON - Département des Sciences Economiques) 2005017, Université catholique de Louvain, Département des Sciences Economiques, revised 15 Feb 2005.
  10. Edward L. Glaeser & Matthew E. Kahn, 2003. "Sprawl and Urban Growth," NBER Working Papers 9733, National Bureau of Economic Research, Inc.
  11. Abdel-Rahman, Hesham M. & Anas, Alex, 2004. "Theories of systems of cities," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 52, pages 2293-2339 Elsevier.
  12. Peter Egger & Stefan Gruber & Mario Larch & Michael Pfaffermayr, 2007. "Knowledge–capital meets new economic geography," The Annals of Regional Science, Springer, vol. 41(4), pages 857-875, December.
  13. De Bruyne, Karolien, 2009. "Explaining the Location of Economic Activity. Is there a Spatial Employment Structure in Belgium?," Working Papers 2009/28, Hogeschool-Universiteit Brussel, Faculteit Economie en Management.
  14. Frank Cörvers & Maud Hensen, 2003. "The regionalization of labour markets by modelling commuting behaviour," ERSA conference papers ersa03p199, European Regional Science Association.
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Cited by:
  1. Sandow, Erika & Westin, Kerstin, 2010. "The persevering commuter - Duration of long-distance commuting," Transportation Research Part A: Policy and Practice, Elsevier, vol. 44(6), pages 433-445, July.

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