Traditional theory of international trade has been developed on the assumption of homogeneous country in which identical consumers and production factors are all uniformly distributed. In the real world, however, most countries are composed of heterogeneous regions, and in accordance the above...

The spatial distribution of industries and population is quite lumpy, and this lumpiness varies across industries. Nevertheless, we show using Japanese data for metropolitan areas that the locations of both industries and population are linked by surprisingly simple and persistent patterns. In...