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Trade liberalization and the modern metropolis

  • Toshihiro Atsumi
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    What is the impact of international trade on cities and rural areas within a country? Existing studies on this topic are based on new economic geography models, which focus on the effect of international trade on the change in the balance between agglomeration and dispersion forces of the manufacturing firms. Recent studies, however, suggest that large cities today can be characterized as specializing in providing business services to host corporate headquarters, rather than as agglomeration of manufacturing. This paper tries to answer the same question by modelling a modern city that provides business services to host corporate headquarters, and argues that the city is likely to grow larger with trade liberalization.

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    File URL: http://www.nottingham.ac.uk/gep/documents/papers/2010/10-02.pdf
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    Paper provided by University of Nottingham, GEP in its series Discussion Papers with number 10/02.

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    Handle: RePEc:not:notgep:10/02
    Contact details of provider: Postal: School of Economics University of Nottingham University Park Nottingham NG7 2RD
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    1. BEHRENS, Kristian & GAIGNE, Carl & OTTAVIANO, Gianmarco I.P. & THISSE, Jacques-François, . "Countries, regions and trade: on the welfare impacts of economic integration," CORE Discussion Papers RP -1936, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Roberts, Mark J & Tybout, James R, 1997. "The Decision to Export in Colombia: An Empirical Model of Entry with Sunk Costs," American Economic Review, American Economic Association, vol. 87(4), pages 545-64, September.
    3. Monfort, Philippe & Nicolini, Rosella, 1998. "Regional Convergence and International Integration," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 1998022, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    4. Ono, Yukako, 2003. "Outsourcing business services and the role of central administrative offices," Journal of Urban Economics, Elsevier, vol. 53(3), pages 377-395, May.
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    6. J Bradford Jensen & Andrew B Bernard, 2001. "Why Some Firms Export," Working Papers 01-05, Center for Economic Studies, U.S. Census Bureau.
    7. Andrew Bernard & Joachim Wagner, 2001. "Export entry and exit by German firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 137(1), pages 105-123, March.
    8. Gilles Duranton & Diego Puga, 2001. "From Sectoral To Functional Urban Specialisation," CEP Discussion Papers dp0511, Centre for Economic Performance, LSE.
    9. Paluzie i Hernandez, Elisenda, 1999. "Trade policy and regional inequalities," ERSA conference papers ersa99pa231, European Regional Science Association.
    10. Jess Gaspar & Edward Glaeser, 1996. "Information Technology and the Future of Cities," NBER Working Papers 5562, National Bureau of Economic Research, Inc.
    11. Gordon H. Hanson, 1994. "Regional Adjustment to Trade Liberalization," NBER Working Papers 4713, National Bureau of Economic Research, Inc.
    12. OTTAVIANO, Gianmarco & THISSE, Jacques-François, 1999. "Agglomeration and trade revisited," CORE Discussion Papers 1999041, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    13. Krugman, Paul, 1980. "Scale Economies, Product Differentiation, and the Pattern of Trade," American Economic Review, American Economic Association, vol. 70(5), pages 950-59, December.
    14. Krugman, Paul & Elizondo, Raul Livas, 1996. "Trade policy and the Third World metropolis," Journal of Development Economics, Elsevier, vol. 49(1), pages 137-150, April.
    15. David S. Jacks & Christopher M. Meissner & Dennis Novy, 2008. "Trade Costs, 1870-2000," American Economic Review, American Economic Association, vol. 98(2), pages 529-34, May.
    16. Nitsch, Volker, 2006. "Trade Openness and Urban Concentration: New Evidence," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 21, pages 340-362.
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