Increasing Returns and Economic Geography-英文文献.pdf

Increasing Returns and Economic Geography Paul Krugman Massachusetts Institute of Technology This paper develops a simple model that shows how a country can endogenously become differentiated into an industrialized core and an agricultural periphery. In order to realize scale economies while minimizing transport costs, manufacturing firms tend to locate in the region with larger demand, but the location of demand itself depends on the distribution of manufacturing. Emergence of a core-periphery pattern depends on transportation costs, economies of scale, and the share of manufacturing in national income. The study of economic geography-of the location of factors of pro- duction in space-occupies a relatively small part of standard eco- nomic analysis. International trade theory, in particular, convention- ally treats nations as dimensionless points (and frequently assumes zero transportation costs between countries as well). Admittedly, models descended from von Thunen (1826) play an important role in urban studies, while Hotelling-type models of locational competi- tion get a reasonable degree of attention in industrial organization. On the whole, however, it seems fair to say that the study of economic geography plays at best a marginal role in economic theory. On the face of it, this neglect is surprising. The facts of economic geography are surely among the most striking features of real-world economies, at least to laymen. F