We consider an economy in which a heterogeneous population of agents have to choose among a common set of alternatives. The utilities associated to the different alternatives posses a common component and an individual component, which reflect differences in the underlying structure of agents...

In the literature of new trade theory, most papers study the industrial location by imposing the assumption of free transportation in the agricultural sector. This paper explicitly incorporates arbitrary transport costs in both the manufacturing and the agricultural sectors into the...

The explosion of multinational activities in recent decades is rapidly transforming the global landscape of industrial production. But are the emerging clusters of multinational production the rule or the exception? What drives the offshore agglomeration of multinational firms in comparison to...

This paper studies how the strength of social ties are affected by the geographical location of other individuals and their social capital. We characterize the equilibrium in terms of both social interactions and social capital. We show that lower travel costs increase not only the interaction...

Benefit from the advantage of externalities, urban agglomerations are playing more and more important roles in regional economic development. However, present literature failed to distinguish the differences between urban agglomerations' pecuniary externality and technology externality. In this...