We develop a new dynamic general equilibrium model to explain firm entry, exit, and relocation decisions in an urban economy with multiple locations and agglomeration externalities. We characterize the stationary distribution of firms that arises in equilibrium. We estimate the parameters of the...

Purpose By observing facts of the "reversal of agglomeration" of Chinese enterprises during the period of rapid Internet development and using a new economic geography model combined with the data of the real estate sector, this paper deduces the influence of the "reshaping mechanisms" of the...

A new general-equilibrium model that links together rural-to-urban migration, the externality effect of the average level of human capital, and agglomeration economies shows that in developing countries, unrestricted rural-to-urban migration reduces the average income of both rural and urban...

In the presence of agglomeration economies, the effects of a rural roads programme depend not only on the reduction in transportation costs, but also on the form of labour mobility. When financed by a poll tax on rural households, the wage will rise, accompanied by some return migration,...

Do urban agglomeration economies enhance the social profitability of rural roads? When all goods are traded at parametric world prices, lower transport costs benefit villagers. Urban activities and welfare are unaffected if labour is immobile, but their levels fall when rural workers move freely...

Economic research on industry location and agglomeration has focused nearly exclusively on manufacturing. This paper shows that services are prominent among the most agglomerated industries, especially at the county level. Because traditional measures of knowledge spillovers, natural resource...

Urbanization economies - the effects on productivity and utility created endogenously by larger cities - are a fundamental component of both the economic geography of modern societies and the perpetuation of innovation and economic growth at a national level. Cities account for vast majorities...

This paper studies urban sustainability from the perspective ofexternalities. We develop a general spatialequilibrium model of a monocentric city, in which two types ofexternalities occur. On the one hand, pollution inthe industrial centre leads to a spatially differentiateddeterioration of the...

This paper is concerned with the economics of urban externalities. We start by reviewing the literature on urban externalities, and observe that although many interesting contributions have been made, there seems to be sufficient scope and need for further research, both theoretically and...

The division of labor between and within countries is driven by two fundamental forces, comparative advantage and increasing returns. We set up a simple Ricardian model with a Marshallian input sharing mechanism to study their interplay. The key insight that emerges is that the interaction...