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Spatial Frictions

  • Behrens, Kristian

    ()

    (University of Québec at Montréal)

  • Mion, Giordano

    ()

    (CEP, London School of Economics)

  • Murata, Yasusada

    ()

    (Nihon University)

  • Suedekum, Jens

    ()

    (Heinrich Heine University Düsseldorf)

The world is replete with spatial frictions. Shipping goods across cities entails trade frictions. Commuting within cities causes urban frictions. How important are these frictions in shaping the spatial economy? We develop and quantify a novel framework to address this question at three different levels: Do spatial frictions matter for the city-size distribution? Do they affect individual city sizes? Do they contribute to the productivity advantage of large cities and the toughness of competition in cities? The short answers are: no; yes; and it depends.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7175.

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Length: 64 pages
Date of creation: Jan 2013
Date of revision:
Handle: RePEc:iza:izadps:dp7175
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