This paper shows that subsidy competition may be efficiency enhancing. We model a subsidy game among two asymmetric regions in a new trade model, where capital can freely move among regions, but capital rewards are repatriated. We study subsidy competition, starting from an equilibrium where the...

We study the optimal and equilibrium size of cities in a city system model with environmental pollution. Pollution is related to city size through the effect of population on production, commuting, and housing consumption. With symmetric cities, if pollution is local or per capita pollution...

This paper analyses the growth of American cities, understood as the growth of the population or of the per capita income, from 1990 to 2000. This empirical analysis uses data from all the cities (incorporated places) with more than 25,000 inhabitants in the year 2000 (1152 cities). The results...

This paper shows that subsidy competition may be efficiency enhancing. We model a subsidy game among two asymmetric regions in a new trade model, where capital can freely move among regions, but capital rewards are repatriated. We study subsidy competition, starting from an equilibrium where the...