Redding, Stephen (2009) Economic geography: a review of the theoretical and empirical literature. CEP Discussion Papers, 904. Centre for Economic Performance, London School of Economics and Political Science, London, UK.
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This paper reviews the new economic geography literature, which accounts for the uneven distribution of economic activity across space in terms of a combination of love of variety preferences, increasing returns to scale and transport costs. After outlining the canonical core and periphery model, the paper examines the empirical evidence on three of its central predictions: the role of market access in determining factor prices, the related home market effect in which demand has a more than proportionate effect on production, and the potential existence of multiple equilibria. In reviewing the evidence, we highlight issues of measurement and identification, alternative potential explanations, and remaining areas for further research.
|Item Type:||Monograph (Discussion Paper)|
|Additional Information:||© 2009 Stephen Redding|
|Library of Congress subject classification:||H Social Sciences > HC Economic History and Conditions
G Geography. Anthropology. Recreation > G Geography (General)
|Journal of Economic Literature Classification System:||F - International Economics > F1 - Trade > F14 - Country and Industry Studies of Trade
O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O10 - General
F - International Economics > F1 - Trade > F12 - Models of Trade with Imperfect Competition and Scale Economies
|Sets:||Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Departments > Economics
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