Fenge R, von Ehrlich M, Wrede M (2009)
Publication Language: English
Publication Type: Journal article
Publication year: 2009
Publisher: Elsevier
Book Volume: 39
Pages Range: 621 – 631
DOI: 10.1016/j.regsciurbeco.2009.04.003
This paper analyzes the impact of public input competition in a New Economic Geography framework. It is shown that regional competition yields an overprovision of public inputs if trade costs are sizable while it leads to underprovision if regions are highly integrated. Moreover, public input competition assures a dispersion of industry as long as trade costs are high but induces agglomeration even for ex ante identical regions if trade costs have fallen below a certain value. Finally, a trade-off between regional convergence and efficiency arises since the efficient distribution of regional infrastructure requires full agglomeration for sufficiently low trade costs. © 2009 Elsevier B.V. All rights reserved.
APA:
Fenge, R., von Ehrlich, M., & Wrede, M. (2009). Public Input Competition and Agglomeration. Regional Science and Urban Economics, 39, 621 – 631. https://dx.doi.org/10.1016/j.regsciurbeco.2009.04.003
MLA:
Fenge, Robert, Maximilian von Ehrlich, and Matthias Wrede. "Public Input Competition and Agglomeration." Regional Science and Urban Economics 39 (2009): 621 – 631.
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