Governmental activity, integration, and agglomeration
AbstractThis paper analyzes, within a regional growth model, the impact of productive governmental policy and integration on the spatial distribution of economic activity. Integration is understood as enhancing territorial cooperation between the regions, and it describes the extent to which one region may benefit from the other region's public input, e.g. the extent to which regional road networks are connected. Both, integration and the characteristics of the public input crucially affect whether agglomeration arises and if so to which extent economic activity is concentrated: As a consequence of enhanced intergation, agglomeration is less likely to arise and concentration will be lower. Relative congestion reinforces agglomerartion, thereby increasing equilibrium concentraion. Due to the congestion externalities, the market outcome ends up in subotimally high concentration.
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Bibliographic InfoPaper provided by University of Lüneburg, Institute of Economics in its series Working Paper Series in Economics with number 57.
Length: 37 pages
Date of creation: Jul 2006
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public inputs; agglomeration; integration;
Other versions of this item:
- Ott, Ingrid & Soretz, Susanne, 2007. "Governmental activity, integration, and agglomeration," HWWI Research Papers 1-10, Hamburg Institute of International Economics (HWWI).
- Ingrid Ott & Susanne Soretz, 2008. "Governmental activity, integration, and agglomeration," Kiel Working Papers 1465, Kiel Institute for the World Economy.
- O4 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
- R5 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-08-08 (All new papers)
- NEP-GEO-2007-08-08 (Economic Geography)
- NEP-URE-2007-08-08 (Urban & Real Estate Economics)
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