We develop a general model to assess the pros and cons of the iceberg approach compared to alternative ways of modelling transportation in international trade. The main contributions of the literature are encompassed as special cases. Since iceberg costs are introduced in the Heckscher- Ohlin...

We study an OLG economy where productivity growth comes from two alternative sources: process innovation and learning-by-doing. There is a trade-off between the two in so far as frequent technological updates reduce the scope for learning on existing technologies. A conflict is shown to arise...

The purpose of this article is twofold. First, we present an alternative model of agglomeration and trade that displays the main features of the recent economic geography literature while allowing for the derivation of analytical results by means of simple algebra. Second, we show how this...

We depict an industrial district as a center of innovation where positive local spillovers sustain the endogenous invention of new goods by profit-seeking firms. After invention, firms face a crucial choice between reaching distant markets by export or plant delocation. Attempts by firms to...

So far the contribution of New Economic Geography (NEG) has been mainly positive. Normative analysis and policy implications have lagged behind. The reason is the fear of the consequences of taking too literally the neat structure of the models. Under this respect the somewhat incautious aim of...

We introduce incomplete outsourcing contracts in an otherwise standard model of MNEs based on the trade-off between proximity and concentration. This has both positive and normative implications. As to the former, incomplete outsourcing contracts can account for the observed emergence of FDIs in...

Since its very appearance, probably due to its provocative name, New Economic Geography has stirred a debate on whether it is economic geography proper or rather geographical economics. In both cases, its real novelty has been questioned. We focus on this last issue. In particular, we argue that...

There exists a growing body of literature which looks at export decisions made by firms. Most studies focus on developed countries and do not explore whether different behavioral patterns prevail over the firm size distribution. This paper aims at filling this gap in the literature by analyzing...

How many "American jobs" have U.S.-born workers lost due to immigration and offshoring? Or, alternatively, is it possible that immigration and offshoring, by promoting cost-savings and enhanced efficiency in firms, have spurred the creation of jobs for U.S. natives? We consider a multi-sector...

We investigate the relationship between diversity and productivity in Europe using an original dataset covering the NUT3 regions of 12 countries of the EU15 (Austria, Belgium, Denmark, France, former Western Germany, Ireland, Italy, the Netherlands, Portugal, Spain, Sweden and the United...