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Globalization, Interregional and International Inequalities

Author

Listed:
  • Dao-Zhi Zeng

    (Graduate School of Management, Kagawa University, Japan)

  • Laixun Zhao

    (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan)

Abstract

This paper examines interregional and international inequalities in a setup of two countries and four regions. Different from the existing literature, countries and regions are not required to be symmetric in size. Capital but not labor is mobile across regions and countries. We find that the interregional and international inequalities are closely related to globalization and the efficiency of local governance. In other words, they are jointly determined by the domestic transport costs (e.g., infrastructure, administrative barriers, etc) in the two countries and the international trade cost. Particularly, the interregional inequality may be either a monotonically increasing or an inverted U-curve function of its own domestic transport costs. Also, the interregional inequality decreases with the national manufacturing share. These results shed light on the so-called "deindustrialization"phenomenon.

Suggested Citation

  • Dao-Zhi Zeng & Laixun Zhao, 2007. "Globalization, Interregional and International Inequalities," Discussion Paper Series 209, Research Institute for Economics & Business Administration, Kobe University.
  • Handle: RePEc:kob:dpaper:209
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    File URL: http://www.rieb.kobe-u.ac.jp/academic/ra/dp/English/dp209.pdf
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Lessmann, Christian, 2014. "Spatial inequality and development — Is there an inverted-U relationship?," Journal of Development Economics, Elsevier, vol. 106(C), pages 35-51.
    2. Xi Yang & Nobuaki Hamaguchi, 2013. "Trade infrastructure and firm location under Cournot competition," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 50(1), pages 153-167, February.
    3. Stark, Oded, 2015. "Comparing the Global and Merged with the Local and Separate: On a Downside to the Integration of Regions and Nations," East Asian Economic Review, Korea Institute for International Economic Policy, vol. 19(4), pages 325-355, December.
    4. Oded Stark & Franz Rendl & Marcin Jakubek, 2012. "The merger of populations, the incidence of marriages, and aggregate unhappiness," Journal of Evolutionary Economics, Springer, vol. 22(2), pages 331-344, April.
    5. repec:gam:jsusta:v:8:y:2016:i:2:p:157:d:63591 is not listed on IDEAS
    6. Jian Wang & Xiao-Ping Zheng, 2013. "Industrial Agglomeration: Asymmetry Of Regions And Trade Costs," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 25(2), pages 61-78, July.
    7. Jorge L. García-Alcaraz & Aidé A. Maldonado-Macías & Juan L. Hernández-Arellano & Julio Blanco-Fernández & Emilio Jiménez-Macías & Juan C. Sáenz-Díez Muro, 2016. "Agricultural Tractor Selection: A Hybrid and Multi-Attribute Approach," Sustainability, MDPI, Open Access Journal, vol. 8(2), pages 1-16, February.
    8. Toshiaki Takahashi & Hajime Takatsuka & Dao-Zhi Zeng, 2013. "Spatial inequality, globalization, and footloose capital," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 53(1), pages 213-238, May.

    More about this item

    Keywords

    Regional Inequality; Firm Location; Infrastructure; Governance; Deindustrialization;

    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)

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