The Formation of Urban Centers under R\&D and Spillover Externalities
This paper proposes a model of urban agglomeration in conjunction with imperfect competition and endogenous product R\&D of firms. The quality of differentiated manufacturing goods is a result of R\&D services provided by research firms. Sectoral interactions are subject to spatially dependent transaction costs and (knowledge) spillover externalities. The paper analyzes the existence of fundamental city patterns with respect to R\&D intensity and the degree of localization in knowledge production. The model features three equilibrium formations: a monocentric, a mixed, and a perfectly integrated pattern, whereas the R\&D intensity always increases towards the city center. However, product quality and the corresponding R\&D expenditures of firms are not necessarily increasing with the city size; a result, which also renders decisive implications of local innovation policy.
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- Marcus Berliant & Robert R. Reed, III & Ping Wang, 2000.
"Knowledge exchange, matching, and agglomeration,"
Discussion Paper / Institute for Empirical Macroeconomics
135, Federal Reserve Bank of Minneapolis.
- Marcus Berliant & Robert R. Reed III & Ping Wang, 2005. "Knowledge Exchange, Matching, and Agglomeration," Urban/Regional 0506013, EconWPA, revised 07 Jul 2005.
- Marcus Berliant & Robert R. Reed III & Ping Wang, 2000. "Knowledge Exchange, Matching, and Agglomeration," Vanderbilt University Department of Economics Working Papers 0033, Vanderbilt University Department of Economics.
- Marcus Berliant, 2003. "Knowledge Exchange, Matching, and Agglomeration," Theory workshop papers 505798000000000026, UCLA Department of Economics.
- Marcus Berliant & Robert R Reed & Ping Wang, 2003. "Knowledge Exchange, Matching, and Agglomeration," Levine's Bibliography 666156000000000395, UCLA Department of Economics.
- Marcus Berliant & Robert R. Reed III & Ping Wang, 2000. "Knowledge Exchange, Matching, and Agglomeration," Econometric Society World Congress 2000 Contributed Papers 0261, Econometric Society.
- Marcus Berliant & Robert R. Reed III & Ping Wang, 2004. "Knowledge Exchange, Matching, and Agglomeration," Urban/Regional 0405007, EconWPA, revised 03 Dec 2004.
- Gerald Carlino & Satyajit Chatterjee & Robert Hunt, 2006.
"Urban density and the rate of invention,"
06-14, Federal Reserve Bank of Philadelphia.
- Iammarino, Simona & McCann, Philip, 2006.
"The structure and evolution of industrial clusters: Transactions, technology and knowledge spillovers,"
Elsevier, vol. 35(7), pages 1018-1036, September.
- Simona Iammarino & Philip McCann, 2006. "The Structure and Evolution of Industrial Clusters: Transactions, Technology and Knowledge Spillovers," SPRU Working Paper Series 138, SPRU - Science and Technology Policy Research, University of Sussex.
- Berliant, Marcus & Peng, Shin-Kun & Wang, Ping, 2002.
"Production Externalities and Urban Configuration,"
Journal of Economic Theory,
Elsevier, vol. 104(2), pages 275-303, June.
- Marcus Berliant & Shin-Kun Peng & Ping Wang, 2000. "Production Externalities and Urban Configuration," Vanderbilt University Department of Economics Working Papers 0011, Vanderbilt University Department of Economics.
- Jan Kranich, 2007. "Too much R&D? - Vertical differentiation in a model of monopolistic competition," Working Paper Series in Economics 59, University of Lüneburg, Institute of Economics.
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