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Aging nations and the future of cities

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  • Gaigné, Carl
  • Thisse, Jacques-François

Abstract

We investigate whether an aging population may challenge the supremacy of large working-cities. To this end, we develop an economic geography model with two types of individuals (the elderly and workers) and two sectors (consumer services and manufacturing). Individuals are geographically mobile and their agglomeration within a city generates rising urban costs through competition for land. When the elderly are immobile and equally distributed between cities, an aging population works against the agglomeration of production. When the elderly are free to choose their residence, the most likely scenario is such that the city with the lower share of old people follows a U-shaped curve. Increasing commuting costs cut short the first phase in which the employment share decreases.

Suggested Citation

  • Gaigné, Carl & Thisse, Jacques-François, 2009. "Aging nations and the future of cities," Working Papers 210993, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    • Handle: RePEc:ags:inrasl:210993
    DOI: 10.22004/ag.econ.210993
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    1. Takatoshi Tabuchi & Jacques-François Thisse, 2006. "Regional Specialization, Urban Hierarchy, And Commuting Costs," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 47(4), pages 1295-1317, November.
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    6. Masahisa Fujita & Paul Krugman & Anthony J. Venables, 2001. "The Spatial Economy: Cities, Regions, and International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262561476, April.
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    10. J. V. Henderson & J. F. Thisse (ed.), 2004. "Handbook of Regional and Urban Economics," Handbook of Regional and Urban Economics, Elsevier, edition 1, volume 4, number 4.
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    Cited by:

    1. Grafeneder-Weissteiner, Theresa & Prettner, Klaus, 2013. "Agglomeration and demographic change," Journal of Urban Economics, Elsevier, vol. 74(C), pages 1-11.
    2. Madoka Muroishi & Akira Yakita, 2021. "Agglomeration economies, congestion diseconomies, and fertility dynamics in a two-region economy," Letters in Spatial and Resource Sciences, Springer, vol. 14(1), pages 51-63, April.
    3. Rafael González‐Val, 2010. "The Evolution Of U.S. City Size Distribution From A Long‐Term Perspective (1900–2000)," Journal of Regional Science, Wiley Blackwell, vol. 50(5), pages 952-972, December.
    4. Takahashi, Takaaki, 2022. "On the economic geography of an aging society," Regional Science and Urban Economics, Elsevier, vol. 95(C).
    5. Dean M. Hanink, 2010. "Perspectives on Regional Change: A Review Essay on Handbook of Regional Growth and Development Theories," Growth and Change, Wiley Blackwell, vol. 41(1), pages 3-27, March.
    6. Carl Gaigné & Jacques-François Thisse, 2013. "New Economic Geography and the City," Working Papers SMART 13-02, INRAE UMR SMART.
    7. K. Newbold, 2015. "Population aging: What role for regional science?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 55(2), pages 357-372, December.
    8. Steven Brakman & Charles Van Marrewijk, 2009. "Introduction: Heterogeneity At Different Spatial Scales," Journal of Regional Science, Wiley Blackwell, vol. 49(4), pages 607-615, October.
    9. David Plane, 2012. "What about aging in regional science?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 48(2), pages 469-483, April.
    10. Seunghun Chung & Oudom Hean, 2023. "The Effects of Aging Populations on U.S. Communities," Economies, MDPI, vol. 11(11), pages 1-9, November.

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    More about this item

    Keywords

    Industrial Organization;

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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