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Increasing Returns in Transportation and the Formation of Hubs

  • Tomoya Mori

    ()

    (Institute of Economic Research, Kyoto University)

The spatial structure of transport network is subject to increasing returns in transportation, distance and density economies. Transport costs between locations are thus in general endogenous, and are determined by the interaction between the spatial distribution of transport demand and these increasing returns, although such interdependence has long been ignored in regional models. By using a simple model, the present paper explains the formation of transport hubs endogenously, and shows how the balance of these two types of increasing returns influences the spatial distribution of transport hubs.

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File URL: http://www.kier.kyoto-u.ac.jp/DP/DP770.pdf
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Paper provided by Kyoto University, Institute of Economic Research in its series KIER Working Papers with number 770.

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Length: 28pages
Date of creation: Apr 2011
Date of revision:
Handle: RePEc:kyo:wpaper:770
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