This paper studies the social desirability of agglomeration and the efficiency arguments for policy intervention in a simple, analytically solvable 'new economic geography' model with two trade integrating regions. The location pattern emerging as market equilibrium is bubbleshapedʺ, i.e. it...

Contemporary mainstream normative economists assess policies in terms of their capacities to satisfy preferences, though most would concede that other factors such as freedom, rights, and justice are also relevant. Why should policy be responsive to preferences? This essay argues that the best...