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Is remoteness a locational disadvantage?

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  • Kristian Behrens
  • Carl Gaigné
  • Gianmarco I.P. Ottaviano
  • Jacques-François Thisse

Abstract

We study the impacts of changes in international trade and domestic transport costs on the internal geography of countries in the presence of geographical asymmetries. To do so, we develop a two-country four-region model in which one country has a region that exhibits a 'geographical advantage' in terms of better access to the other country's markets. Our analysis reveals that, in equilibrium, the space-economies of the trading partners are interdependent and that agglomeration in one country reduces the occurrence of agglomeration in the other, thus showing that physical geography suffices to build strong connections between the two space-economies. We also show that remoteness need not be a geographical disadvantage since a landlocked region may well be the location that attracts the larger share of firms. This is so when internal transport costs are high and, therefore, act as a barrier to competition from abroad. Copyright 2006, Oxford University Press.

Suggested Citation

  • Kristian Behrens & Carl Gaigné & Gianmarco I.P. Ottaviano & Jacques-François Thisse, 2006. "Is remoteness a locational disadvantage?," Journal of Economic Geography, Oxford University Press, vol. 6(3), pages 347-368, June.
  • Handle: RePEc:oup:jecgeo:v:6:y:2006:i:3:p:347-368
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    Cited by:

    1. Adolfo Cristobal-Campoamor & Osiris Parcero, 2013. "Behind the Eastern–Western European convergence path: the role of geography and trade liberalization," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 51(3), pages 871-891, December.
    2. Rhydian James & Peter Midmore & Dennis Thomas, 2012. "Public Sector Size and Peripherality," Spatial Economic Analysis, Taylor & Francis Journals, vol. 7(4), pages 447-460, December.
    3. Zeng, Dao-Zhi & Zhao, Laixun, 2010. "Globalization, interregional and international inequalities," Journal of Urban Economics, Elsevier, vol. 67(3), pages 352-361, May.
    4. Tsubota, Kenmei & Kawasaki, Yujiro, 2011. "Myopic or farsighted : bilateral trade agreements among three symmetric countries," IDE Discussion Papers 274, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    5. Corinne Bagoulla & Emmanuelle Chevassus-Lozza & Karine Daniel & Carl Gaigné, 2010. "Regional Production Adjustment to Import Competition: Evidence from the French Agro-Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 92(4), pages 1040-1050.
    6. Kyoko Hirose & Yushi Yoshida, 2012. "Intra-National Regional Heterogeneity in International Trade: Foreign Growth on Exports and Production of Domestic Regions," Discussion Papers 54, Kyushu Sangyo University, Faculty of Economics.
    7. Pierre M. Picard & Dao‐Zhi Zeng, 2010. "A Harmonization Of First And Second Natures," Journal of Regional Science, Wiley Blackwell, vol. 50(5), pages 973-994, December.
    8. Kyoko Hirose & Yushi Yoshida, 2010. "Intra-National Regional Heterogeneity in International Trade," Discussion Papers 42, Kyushu Sangyo University, Faculty of Economics.
    9. Jian Wang & Xiao-Ping Zheng, 2013. "Industrial Agglomeration: Asymmetry Of Regions And Trade Costs," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 25(2), pages 61-78, July.
    10. Miren Lafourcade & Jacques-François Thisse, 2011. "New Economic Geography: The Role of Transport Costs," Chapters,in: A Handbook of Transport Economics, chapter 4 Edward Elgar Publishing.
    11. Behrens, Kristian & Gaigne, Carl & Ottaviano, Gianmarco I.P. & Thisse, Jacques-Francois, 2007. "Countries, regions and trade: On the welfare impacts of economic integration," European Economic Review, Elsevier, vol. 51(5), pages 1277-1301, July.
    12. César Ducruet & Hidekazu Itoh & Olivier Joly, 2015. "Ports and the local embedding of commodity flows," Papers in Regional Science, Wiley Blackwell, vol. 94(3), pages 607-627, August.
    13. Adam Storeygard, 2016. "Farther on down the Road: Transport Costs, Trade and Urban Growth in Sub-Saharan Africa," Review of Economic Studies, Oxford University Press, vol. 83(3), pages 1263-1295.
    14. repec:bla:ijethy:v:13:y:2017:i:1:p:113-145 is not listed on IDEAS
    15. Cazzuffi, Chiara & Pereira-López, Mariana & Soloaga, Isidro, 2017. "Local poverty reduction in Chile and Mexico: The role of food manufacturing growth," Food Policy, Elsevier, vol. 68(C), pages 160-185.
    16. A. Kerem Co?ar & Pablo D. Fajgelbaum, 2016. "Internal Geography, International Trade, and Regional Specialization," American Economic Journal: Microeconomics, American Economic Association, vol. 8(1), pages 24-56, February.
    17. Fernando Bruna, 2015. "Why do empirical tests tend to accept the NEG? An alternative approach to the 'wage equation' in European regions," Working Papers 15-11, Asociación Española de Economía y Finanzas Internacionales.
    18. Kiyohiro Ikeda & Kazuo Murota & Takashi Akamatsu & Yuki Takayama, 2017. "Agglomeration patterns in a long narrow economy of a new economic geography model: Analogy to a racetrack economy," International Journal of Economic Theory, The International Society for Economic Theory, vol. 13(1), pages 113-145, March.
    19. repec:nea:journl:y:2017:i:34:p:94-122 is not listed on IDEAS
    20. PICARD, Pierre M. & ZENG, Dao-Zhi, 2006. "Industrial location : a synthesis of Chamberlin and Ricardo," CORE Discussion Papers 2006055, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    21. Miren Lafourcade & Elisenda Paluzie, 2008. "European integration, FDI and the geography of French trade," Working Papers halshs-00586834, HAL.
    22. Miren Lafourcade & Jacques-François Thisse, 2008. "New economic geography: A guide to transport analysis," Working Papers halshs-00586878, HAL.

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