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Increasing Returns in Transportation and the Formation of Hubs

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  • MORI Tomoya

Abstract

The spatial structure of transport networks is subject to increasing returns in transportation, distance, and density economies. Transport costs between locations are thus, in general, endogenous, and are determined by the interaction between the spatial distribution of transport demand and these increasing returns, although such interdependence has long been ignored in regional models. By using a simple model, the present paper investigates the characteristics of viable hub structures (in terms of spacing and hierarchical relations) given the presence of density and distance economies in transportation.

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Paper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number 12005.

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Length: 31 pages
Date of creation: Jan 2012
Date of revision:
Handle: RePEc:eti:dpaper:12005

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