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Agricultural sector and industrial agglomeration

  • PICARD, Pierre M.
  • ZENG, Dao-Zhi

We investigate an economic geography model in which agricultural goods are costly to transport and in which manufactures hire labor from the local agricultural sector as unskilled labor. We show that agricultural transport costs and local-unskilled labor requirements in firms act as a dispersion force. Location equilibria are compared with the first and second best outcomes and we show that their structure crucially depend on the parameters of agricultural sector.

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File URL: http://dx.doi.org/10.1016/j.jdeveco.2004.03.002
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Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers RP with number -1893.

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Handle: RePEc:cor:louvrp:-1893
Note: In : Journal of Development Economics. Elsevier, 77, 75-106, 2005
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  14. Gugler, Josef, 1982. "Overurbanization Reconsidered," Economic Development and Cultural Change, University of Chicago Press, vol. 31(1), pages 173-89, October.
  15. Gallup, J.L. & Sachs, J.D. & Mullinger, A., 1999. "Geography and Economic Development," Papers 1, Chicago - Graduate School of Business.
  16. Behrens, Kristian, 2004. "Agglomeration without trade: how non-traded goods shape the space-economy," Journal of Urban Economics, Elsevier, vol. 55(1), pages 68-92, January.
  17. Tabuchi, Takatoshi, 1998. "Urban Agglomeration and Dispersion: A Synthesis of Alonso and Krugman," Journal of Urban Economics, Elsevier, vol. 44(3), pages 333-351, November.
  18. John Luke Gallup & Jeffrey D. Sachs & Andrew Mellinger, 1999. "Geography and Economic Development," CID Working Papers 1, Center for International Development at Harvard University.
  19. Donald R. Davis, 1997. "The Home Market, Trade, and Industrial Structure," NBER Working Papers 6076, National Bureau of Economic Research, Inc.
  20. Au, Chun-Chung & Henderson, J. Vernon, 2006. "How migration restrictions limit agglomeration and productivity in China," Journal of Development Economics, Elsevier, vol. 80(2), pages 350-388, August.
  21. Paul Krugman, 1990. "Increasing Returns and Economic Geography," NBER Working Papers 3275, National Bureau of Economic Research, Inc.
  22. Wen, Mei, 2004. "Relocation and agglomeration of Chinese industry," Journal of Development Economics, Elsevier, vol. 73(1), pages 329-347, February.
  23. Henderson, Vernon & Lee, Todd & Lee, Yung Joon, 2001. "Scale Externalities in Korea," Journal of Urban Economics, Elsevier, vol. 49(3), pages 479-504, May.
  24. Hanson, Gordon H., 1996. "Agglomeration, Dispersion, and the Pioneer Firm," Journal of Urban Economics, Elsevier, vol. 39(3), pages 255-281, May.
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