We present a simple model of a two-region economy in which undesirable concentration may occur. With freedom to choose where to live, individuals in this economy concentrate into one region in their pursuit of better life, and end up becoming worse off. We characterize the conditions under which such self-defeating concentration occurs in terms of a few key parameters, such as economies of scale in nontradeable service sectors, regional differences in labor productivity in tradeable goods sectors, and substitutability of tradeable goods in consumption.
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number
4484.
Length: Date of creation: Oct 1993 Date of revision: Handle: RePEc:nbr:nberwo:4484
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Kiminori Matsuyama & Takaaki Takahashi, 1993.
"Self-Defeating Regional Concentration,"
Discussion Papers
1050, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
[Downloadable!]
Kiminori Matsuyama & Takaaki Takahashi, 1993.
"Self-Defeating Regional Concentration,"
Discussion Papers
1086, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
[Downloadable!]
Find related papers by JEL classification: F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Glaeser, Edward L & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1992.
"Growth in Cities,"
Journal of Political Economy,
University of Chicago Press, vol. 100(6), pages 1126-52, December.
[Downloadable!] (restricted)
Other versions:
Edward L. Glaeser & Hedi D. Kallal & Jose A. Scheinkman & Andrei Shleifer, 1991.
"Growth in Cities,"
NBER Working Papers
3787, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
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