Arcalean, Calin; Glomm, Gerhard; Schiopu, Ioana - 2019
productivity differences and internal trade frictions. We show that even in the absence of the typical externalities studied in the … closer to optimal policies than decentralized allocations whenever productivity differences in non-traded sectors are either … very small or very large. For intermediate productivity differences, the urban bias leads to larger cities even relative to …