Adjustment Costs and Long Run Spatial Agglomerations
AbstractWe introduce knowledge spillovers as an externality in the production function of competitive Ãƒï¿½Ã¯Â¿Â½firms operating in a Ãƒï¿½Ã¯Â¿Â½nite spatial domain under adjustment costs. Spillovers are spatial as productive knowledge Ãƒï¿½Ã¯Â¿Â½flows more easily among firms located nearby. When knowledge spillovers are not internalized by Ãƒï¿½Ã¯Â¿Â½firms spatial agglomerations may emerge endogenously in a competitive equilibrium, however, they do not emerge at the steady state of the social optimum.
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Bibliographic InfoPaper provided by Athens University of Economics and Business in its series DEOS Working Papers with number 1327.
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Investment theory; adjustment costs; spatial agglomerations;
Other versions of this item:
- William Brock & Anastasios Xepapadeas & Athanasios Yannacopoulos, 2013. "Adjustment Costs and Long Run Spatial Agglomerations," Working Papers 2013.68, Fondazione Eni Enrico Mattei.
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
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- William A. Brock & Anastasios Xepapadeas & Athanasios N. Yannacopoulos, 2012.
"Optimal Agglomerations in Dynamic Economics,"
2012.64, Fondazione Eni Enrico Mattei.
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- Brock, William A, 1974. "Money and Growth: The Case of Long Run Perfect Foresight," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 15(3), pages 750-77, October.
- Lucas, Robert E, Jr & Prescott, Edward C, 1971. "Investment Under Uncertainty," Econometrica, Econometric Society, vol. 39(5), pages 659-81, September.
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