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Discrete dynamics for the core-periphery model

Author

Listed:
  • L. Garrido-da-Silva

    (Faculdade Economia do Porto - Universidade do Porto)

  • Sofia B.S.D. Castro

    (Faculdade Economia and Centro de Matemática da Universidade do Porto)

  • Paulo B. Vasconcelos

    (Faculdade Economia and Centro de Matemática da Universidade do Porto)

Abstract

It is known that the discretization of continuous-time models can introduce chaotic behaviour, even when this is not consistent with observations or even the model’s assumptions. We propose generic dynamics describing discrete-time core-periphery models that comply with the established assumptions in the literature and are consistent with observed behaviour. The desired properties of the dynamics are proved analytically in the general case. We also give particular forms for the dynamics for those interested in applying our model.

Suggested Citation

  • L. Garrido-da-Silva & Sofia B.S.D. Castro & Paulo B. Vasconcelos, 2014. "Discrete dynamics for the core-periphery model," FEP Working Papers 528, Universidade do Porto, Faculdade de Economia do Porto.
    • Handle: RePEc:por:fepwps:528
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    References listed on IDEAS

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    1. Baldwin, Richard E., 2001. "Core-periphery model with forward-looking expectations," Regional Science and Urban Economics, Elsevier, vol. 31(1), pages 21-49, February.
    2. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    3. Currie, Martin & Kubin, Ingrid, 2006. "Chaos in the core-periphery model," Journal of Economic Behavior & Organization, Elsevier, vol. 60(2), pages 252-275, June.
    4. Frédéric Robert-Nicoud, 2005. "The structure of simple 'New Economic Geography' models (or, On identical twins)," Journal of Economic Geography, Oxford University Press, vol. 5(2), pages 201-234, April.
    5. Rikard Forslid & Gianmarco I.P. Ottaviano, 2003. "An analytically solvable core-periphery model," Journal of Economic Geography, Oxford University Press, vol. 3(3), pages 229-240, July.
    6. Pasquale Commendatore & Martin Currie & Ingrid Kubin, 2008. "Footloose Entrepreneurs, Taxes and Subsidies," Spatial Economic Analysis, Taylor & Francis Journals, vol. 3(1), pages 115-141.
    7. Gian Italo Bischi & Carl Chiarella & Iryna Sushko (ed.), 2013. "Global Analysis of Dynamic Models in Economics and Finance," Springer Books, Springer, edition 127, number 978-3-642-29503-4, December.
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    More about this item

    Keywords

    Core-periphery; discrete-time; dynamics;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques

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