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Geography, Trade Patterns, and Economic Policy

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  • Carlos M. Asilis
  • Luis Rivera-Batiz

Abstract

This paper presents a geographical theory of location and interregional trade. Location is treated as an endogenous variable by firms, consumers and perfectly mobile workers in a two-sector economy. Space plays a central role owing to transportation costs, market access, and distance from polluting industrial centers. The model is used to examine: (1) aspects of a compensating-differential theory of regional unevenness, (2) the theoretical formulation of a gravity theory of trade patterns, (3) the geographic basis for industrial and environmental policy, and (4) the interaction between reductions in transportation costs, location patterns, and technological improvements.

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Bibliographic Info

Paper provided by International Monetary Fund in its series IMF Working Papers with number 94/16.

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Length: 44
Date of creation: 01 Feb 1994
Date of revision:
Handle: RePEc:imf:imfwpa:94/16

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Cited by:
  1. Pozzolo, Alberto Franco, 2003. "Research and Development, Regional Spillovers and the Location of Economic Activities," Economics & Statistics Discussion Papers esdp03008, University of Molise, Dept. EGSeI.
  2. Gianmarco Ottaviano, 1995. "A Geographic Approach to International Economics: 'Strategic Trade Policy'?" -," Working Papers 216, Dipartimento Scienze Economiche, Universita' di Bologna.
  3. Junius, Karsten, 1996. "Limits to industrial agglomeration," Kiel Working Papers 762, Kiel Institute for the World Economy.
  4. A. Porojan, 2001. "Trade Flows and Spatial Effects: The Gravity Model Revisited," Open Economies Review, Springer, vol. 12(3), pages 265-280, July.
  5. Katrin Elborgh-Woytek, 2003. "Of Openess and Distance," IMF Working Papers 03/207, International Monetary Fund.

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