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Coordination Costs and the Geography of Production

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  • Sandrine Noblet
  • Antoine Belgodere

Abstract

In a model à la Venables of 1996, we distinguish two kinds of intermediate goods: complex goods that entail endogenous coordination costs, and simple goods that do not. Coordination costs depend on geographical distance and the number of intermediate goods used in the production process. In the final stage of integration, there are two possible spatial configurations: (1) a symmetric configuration and (2) a partial core–periphery equilibrium, comprised of a core region that produces the final and complex intermediate goods, and a periphery that produces simple intermediate goods. We discuss some policy implications of this multiple-equilibria outcome.Les coûts de coordination et la géographie de la production

Suggested Citation

  • Sandrine Noblet & Antoine Belgodere, 2016. "Coordination Costs and the Geography of Production," Spatial Economic Analysis, Taylor & Francis Journals, vol. 11(4), pages 392-412, October.
  • Handle: RePEc:taf:specan:v:11:y:2016:i:4:p:392-412
    DOI: 10.1080/17421772.2016.1189088
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