City type, city size, trade patterns, and interurban transport costs in a spatial economy
In this paper, the effect of interurban transport costs, incorporating agglomeration economies, on the formation of city structure is examined. It is shown that the city type and the city size will be determined by the effects of interurban transport costs of goods and the advantage (or disadvantage) of agglomeration economies depending on which effect is dominant. It is also shown that the trade patterns in the same type of city will be decided by the interurban transport costs and the transport costs from the world market.
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