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A third sector in the core-periphery model: non-tradable goods
Abstract We extend an analytically solvable core-periphery model by introducing a monopolistically competitive sector of non-tradable goods that is mobile across regions. We find that when the elasticity of substitution among non-tradable goods is very low, there is agglomeration of all the production (of both tradable and non-tradable goods). When the elasticity of substitution among non-tradable goods is sufficiently high (“no black-hole” condition), then there is symmetric dispersion of all the production, if trade costs are high; or full agglomeration of the production of tradable goods with partial agglomeration of the production of non-tradable goods, if trade costs are low.
A third sector in the core-periphery model: non-tradable goods
Abstract We extend an analytically solvable core-periphery model by introducing a monopolistically competitive sector of non-tradable goods that is mobile across regions. We find that when the elasticity of substitution among non-tradable goods is very low, there is agglomeration of all the production (of both tradable and non-tradable goods). When the elasticity of substitution among non-tradable goods is sufficiently high (“no black-hole” condition), then there is symmetric dispersion of all the production, if trade costs are high; or full agglomeration of the production of tradable goods with partial agglomeration of the production of non-tradable goods, if trade costs are low.
A third sector in the core-periphery model: non-tradable goods
Leite, Vasco (author) / Castro, Sofia B. S. D. (author) / Correia-da-Silva, João (author)
2011
Article (Journal)
Electronic Resource
English
BKL:
83.64$jRegionalwirtschaft
/
74.12
Stadtgeographie, Siedlungsgeographie
/
38.00$jGeowissenschaften: Allgemeines
/
38.00
Geowissenschaften: Allgemeines
/
83.64
Regionalwirtschaft
/
74.12$jStadtgeographie$jSiedlungsgeographie
RVK:
ELIB39
/
ELIB18
/
ELIB45
Local classification FBW:
oek 4450
A third sector in the core-periphery model: non-tradable goods
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