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Agglomerations in a Multi-region Economy: Polycentric versus monocentric patterns

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  • AKAMATSU Takashi
  • MORI Tomoya
  • TAKAYAMA Yuki

Abstract

Agglomeration externalities have been recognized as major sources of lumpy spatial distributions of industries and population. While the abstraction of interregional space has been a common exercise, the recent increasing availability of disaggregated geographical data and more sophisticated computational techniques have promoted counterfactual analyses based on many-region models of agglomeration externalities with explicit interregional space (e.g., Redding and Sturm, 2008; Allen and Arkolakis, 2014). A caveat is that incorporating interregional space to a many-region model with agglomeration externalities by itself does not warrant the formation of polycentric agglomerations in stable equilibria—a crucial property in order to replicate the observed geography of agglomerations. We elaborate this point by comparing a pair of new economic geography models: Forslid and Ottaviano (2003) and Helpman (1998). In a two-region economy, these models exhibit both "agglomeration" (i.e., a relative concentration of mobile agents in one of the regions) and "dispersion" (i.e., a uniform distribution of mobile agents across the two regions). But, if the location space were more disaggregated, only the former admits polycentric agglomerations in stable equilibria, while in the latter, only a monocentric agglomeration can occur if any.

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  • AKAMATSU Takashi & MORI Tomoya & TAKAYAMA Yuki, 2016. "Agglomerations in a Multi-region Economy: Polycentric versus monocentric patterns," Discussion papers 16009, Research Institute of Economy, Trade and Industry (RIETI).
  • Handle: RePEc:eti:dpaper:16009
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    Cited by:

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    2. Minoru Osawa & Takashi Akamatsu & Yuki Takayama, 2017. "Harris And Wilson (1978) Model Revisited: The Spatial Period‐Doubling Cascade In An Urban Retail Model," Journal of Regional Science, Wiley Blackwell, vol. 57(3), pages 442-466, June.
    3. Marcus Berliant & Tomoya Mori, 2017. "Beyond urban form: How Masahisa Fujita shapes us," International Journal of Economic Theory, The International Society for Economic Theory, vol. 13(1), pages 5-28, March.
    4. Ikeda, Kiyohiro & Aizawa, Hiroki & Gaspar, Jose M., 2020. "How and where satellite cities form around a large city: Bifurcation mechanism of a long narrow economy," MPRA Paper 104748, University Library of Munich, Germany.
    5. Kensuke Ohtake & Atsushi Yagi, 2022. "Pointwise agglomeration in continuous racetrack model," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 21(2), pages 211-235, May.

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    More about this item

    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)
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies
    • F15 - International Economics - - Trade - - - Economic Integration
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium

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