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This paper reviews the new economic geography literature, which accounts for the uneven distribution of economic activity across space in terms of a combination of love of variety preferences, increasing returns to scale and transport costs. After outlining the canonical core and periphery...
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large initially increase their employment density following trade liberalization. Second, there has also been an increased …
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compared to less-affected regions. This is consistent with the theory according to which governments can tax rents that arise …
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