agglomeration externalities, where workers may commute within and between cities. First, commuting subsidies serve to internalize … agglomeration externalities: Intracity commuting subsidies give incentives to move to the larger city and intercity commuting … subsidies make residents of the periphery commute to the core. Second, if agglomeration rents are locally captured, commuting …

efficiency arises since the efficient distribution of regional infrastructure requires full agglomeration for sufficiently low …