General Geographical Economics Model with Congestion
AbstractWe derive and discuss a general, but simple geographical economics model with congestion, allowing us to explain the economic viability of small and large locations. The model generalizes some previous work and lends itself to analyzing the impact of public policy in terms of infrastructure changes. We show analytically that scale effects (total size of the economy) and changes in the cost structure (fixed and marginal costs) are important from a welfare perspective, but largely irrelevant from an economic dynamics perspective.
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Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 05-100/2.
Date of creation: 31 Oct 2005
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Geographical economics; congestion; externalities;
Find related papers by JEL classification:
- F - International Economics
- O - Economic Development, Technological Change, and Growth
- R - Urban, Rural, Regional, Real Estate, and Transportation Economics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-01-24 (All new papers)
- NEP-GEO-2006-01-24 (Economic Geography)
- NEP-URE-2006-01-24 (Urban & Real Estate Economics)
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