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Dynamic agglomeration patterns in a 2-country NEG model with 4 regions

Author

Listed:
  • Pasquale Commendatore

    () (University of Naples ‘Federico II’, Italy)

  • Ingrid Kubin

    () (Vienna University of Economics and Business)

  • Pascal Mossay

    (Newcastle University)

  • Iryna Sushko

    () (National Academy of Science of Ukraine)

Abstract

We introduce a 2-country New Economic Geography model with 4 regions. It is defined by a 2D piecewise smooth map that depends on 8 parameters. Using reductions of this map to 1D maps defined on invariant straight lines we obtain stability conditions of the Core-Periphery fixed points, and show how such reductions can be used to describe basins of attraction of coexisting attractors. Typical bifurcation sequences obtained when varying some parameters are discussed. We find patterns that are much richer than those observed in standard NEG models: there are more types of fixed points including fixed points attracting in Milnor’s sense; their basins of attraction are quite complicated; and coexistence is pervasive.

Suggested Citation

  • Pasquale Commendatore & Ingrid Kubin & Pascal Mossay & Iryna Sushko, 2015. "Dynamic agglomeration patterns in a 2-country NEG model with 4 regions," Gecomplexity Discussion Paper Series 10, Action IS1104 "The EU in the new complex geography of economic systems: models, tools and policy evaluation", revised Feb 2015.
  • Handle: RePEc:cst:wpaper:10
    as

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    File URL: http://www.gecomplexity-cost.eu/repec/cst/wpaper/geco_dp_10.pdf
    File Function: First version, 2015
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    References listed on IDEAS

    as
    1. Kristian Behrens, 2011. "International Integration And Regional Inequalities: How Important Is National Infrastructure?," Manchester School, University of Manchester, vol. 79(5), pages 952-971, September.
    2. Krugman, Paul & Elizondo, Raul Livas, 1996. "Trade policy and the Third World metropolis," Journal of Development Economics, Elsevier, vol. 49(1), pages 137-150, April.
    3. Monfort, Philippe & Nicolini, Rosella, 2000. "Regional Convergence and International Integration," Journal of Urban Economics, Elsevier, vol. 48(2), pages 286-306, September.
    4. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    5. Sofia B.S.D. Castro & João Correia-da-Silva & Pascal Mossay, 2012. "The core-periphery model with three regions and more," Papers in Regional Science, Wiley Blackwell, vol. 91(2), pages 401-418, June.
    6. Elisenda Paluzie, 2001. "articles: Trade policy and regional inequalities," Papers in Regional Science, Springer;Regional Science Association International, vol. 80(1), pages 67-85.
    7. Behrens, Kristian & Gaigne, Carl & Ottaviano, Gianmarco I.P. & Thisse, Jacques-Francois, 2007. "Countries, regions and trade: On the welfare impacts of economic integration," European Economic Review, Elsevier, vol. 51(5), pages 1277-1301, July.
    8. Commendatore, Pasquale & Kubin, Ingrid & Petraglia, Carmelo & Sushko, Iryna, 2014. "Regional integration, international liberalisation and the dynamics of industrial agglomeration," Journal of Economic Dynamics and Control, Elsevier, vol. 48(C), pages 265-287.
    9. Takanori Ago & Ikumo Isono & Takatoshi Tabuchi, 2006. "Locational disadvantage of the hub," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 40(4), pages 819-848, December.
    10. Pasquale Commendatore & Ingrid Kubin & Carmelo Petraglia & Iryna Sushko, 2012. "Economic integration and agglomeration in a customs union in the presence of an outside region," Department of Economics Working Papers wuwp146, Vienna University of Economics and Business, Department of Economics.
    11. Commendatore, Pasquale & Kubin, Ingrid & Sushko, Iryna, 2015. "Typical bifurcation scenario in a three region identical New Economic Geography model," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 108(C), pages 63-80.
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    More about this item

    Keywords

    New economic geography; Multiregional models; Two-dimensional piecewises smooth map; Bifurcation scenarios; Milnor attractor;

    JEL classification:

    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F2 - International Economics - - International Factor Movements and International Business
    • 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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