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Mountains in a flat world: Why proximity still matters for the location of economic activity

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Andrés Rodríguez-Pose () (London School of Economics)
Riccardo Crescenzi () (European University Institute)

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Abstract

Thomas Friedman (2005) argues that the expansion of trade, the internationalization of firms, the galloping process of outsourcing, and the possibility of networking is creating a \'flat world\': a level playing field where individuals are empowered and better off. This paper challenges this view of the world by arguing that not all territories have the same capacity to maximize the benefits and opportunities and minimize the risks linked to globalization. Numerous forces are coalescing in order to provoke the emergence of urban \'mountains\' where wealth, economic activity, and innovative capacity agglomerate. The interactions of these forces in the close geographical proximity of large urban areas give shape to a much more complex geography of the world economy.

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Paper provided by Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales in its series Working Papers with number 2008-09.

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Date of creation: 15 Oct 2008
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Publication status: Published in Cambridge Journal of Regions, Economy and Society 1(3), July 2008: 371-388
Handle: RePEc:imd:wpaper:wp2008-09

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