Footloose Capital and Locational Advantage of a Hub

The purpose of this study is to illustrate, with a simple three-region (located on a line), two-good (homogeneous good/differentiated high-tech products), two-factor (labor/``footloose'' capital) model, how falling transport costs can affect firms' location decisions and trade structure. It is shown that the locational advantage of a central hub is magnified via firms' location decisions.

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Year of publication:	2008
Authors:	Kikuchi, Toru
Institutions:	Volkswirtschaftliche Fakultät, Ludwig-Maximilians-Universität München

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Extent:	application/pdf
Series:	MPRA Paper.
Type of publication:	Book / Working Paper
Classification:	F12 - Models of Trade with Imperfect Competition and Scale Economies
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005621609