The Role of Country Size in Spatial Economics : A Survey of the Home Market Effects

This paper surveys the growing literature on the home market effects (HMEs) in spatial economics. The HMEs are utilized to disclose the role of country size in the configuration of economic activity. Various HMEs display distinctive features of size advantage and they are originally obtained from different models. Recent studies find that these features are closely related to each other. The following questions are answered. Are these HMEs equivalent under some conditions? Are some of the properties more general than others? Why do the theoretical studies and empirical studies obtain inconsistent results?