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Is Agglomeration Desirable?

Abstract : By introducing heterogeneity between high-skill mobile and low-skill immobile workers in a model with land rent and commuting costs, we develop a new model in the field of New Economic Geography. This model, which can reveal a dispersion-agglomeration-dispersion configuration when trade becomes freer, is used to compare, via the Pareto criterion, the two possible market outcomes, i.e. agglomeration and dispersion. When these equilibria can be ranked, it is shown that dispersion can be a Pareto-efficient outcome.
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Submitted on : Thursday, July 19, 2018 - 12:12:54 PM
Last modification on : Tuesday, February 2, 2021 - 3:22:02 PM

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Fabien Candau. Is Agglomeration Desirable?. Annals of Economics and Statistics, CNGP-INSEE, 2011, Social Choice and Voting, pp.203-227. ⟨10.2307/41615480⟩. ⟨hal-01844382⟩



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