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Agglomeration in the Periphery

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  • Matti Sarvimäki

Abstract

i. This discussion paper is a completely revised version of SERCDP0047, published April 2010. This paper argues that agglomeration externalities are important even in the rural periphery. The analysis focuses on the forced relocation of more than a tenth of the Finnish population after World War II. Using the details of the resettlement policy to construct instrumental variables for wartime population growth rate, I find that an exogenous increase in municipality's population had a positive effect on later population growth, industrialization and real wages. These findings are consistent with the presence of agglomeration externalities and inconsistent with other popular explanations for the spatial distribution of economic activity.

Suggested Citation

  • Matti Sarvimäki, 2011. "Agglomeration in the Periphery," SERC Discussion Papers 0080, Spatial Economics Research Centre, LSE.
  • Handle: RePEc:cep:sercdp:0080
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    3. Jean-Francois Maystadt & Gilles Duranton, 2014. "The development push of refugees," Working Papers 66910685, Lancaster University Management School, Economics Department.

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    More about this item

    Keywords

    Agglomeration externalities; natural advantages; migration;
    All these keywords.

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • N94 - Economic History - - Regional and Urban History - - - Europe: 1913-

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