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Agglomeration and welfare of the Krugman model in a continuous space

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  • Ohtake, Kensuke

Abstract

Two spatial equilibria, agglomeration, and dispersion, in a continuous space core–periphery model, are examined to discuss which equilibrium is socially preferred. It is shown that when transport cost is lower than a critical value, the agglomeration equilibrium is preferable in the sense of the Scitovszky criterion, while when the transport cost is above the critical value, the two equilibria cannot be ordered in the sense of the Scitovszky criterion.

Suggested Citation

  • Ohtake, Kensuke, 2023. "Agglomeration and welfare of the Krugman model in a continuous space," Mathematical Social Sciences, Elsevier, vol. 123(C), pages 137-142.
    • Handle: RePEc:eee:matsoc:v:123:y:2023:i:c:p:137-142
    DOI: 10.1016/j.mathsocsci.2023.04.001
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    References listed on IDEAS

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    1. José M. Gaspar & Sofia B. S. D. Castro & João Correia-da-Silva, 2018. "Agglomeration patterns in a multi-regional economy without income effects," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 66(4), pages 863-899, December.
    2. Takayama, Yuki & Ikeda, Kiyohiro & Thisse, Jacques-François, 2020. "Stability and sustainability of urban systems under commuting and transportation costs," Regional Science and Urban Economics, Elsevier, vol. 84(C).
    3. Kensuke Ohtake & Atsushi Yagi, 2022. "Pointwise agglomeration in continuous racetrack model," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 21(2), pages 211-235, May.
    4. Ikeda, Kiyohiro & Murota, Kazuo & Akamatsu, Takashi & Kono, Tatsuhito & Takayama, Yuki, 2014. "Self-organization of hexagonal agglomeration patterns in new economic geography models," Journal of Economic Behavior & Organization, Elsevier, vol. 99(C), pages 32-52.
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    8. Akamatsu, Takashi & Takayama, Yuki & Ikeda, Kiyohiro, 2012. "Spatial discounting, Fourier, and racetrack economy: A recipe for the analysis of spatial agglomeration models," Journal of Economic Dynamics and Control, Elsevier, vol. 36(11), pages 1729-1759.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Compensation principle; Continuous racetrack economy; Core–periphery model; Economic agglomeration; Transport cost; Welfare economics;
    All these keywords.

    JEL classification:

    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • D60 - Microeconomics - - Welfare Economics - - - General

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