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Education, Local Amenity and Spatial Agglomeration in a Small-Open Multi-Regional Economic Growth Model: Extending the Uzawa-Lucas Model to an Interregional Economy

Author

Listed:
  • Zhang, Wei-Bin

    (Ritsumeikan Asia Pacific University)

Abstract

This paper proposes a multi-regional growth model with endogenous human and physical capital in a perfectly competitive economy. Structurally it is an extension of the Uzawa-Lucas model to an interregional economy, even though this paper models behavior of households in an alternative way and introduce Arrow’s learning by doing and Zhang’s creative leisure (or learning through consuming) in modeling human capital accumulation. The small-open economy consists of multiple regions and each region has production, one education and one housing sector. The production side is the same as in the neoclassical growth theory. Households move freely among regions, making decisions on levels of choosing housing, education, good, consumption and saving. A region’s amenity which affects households’ decisions is endogenous, depending on the region’s output and population. The model describes a dynamic interdependence among wealth accumulation, human capital accumulation, time distribution (among leisure, work and education) and division of labor with endogenous wealth and income distribution among regions under perfect competition. This study also simulates the motion of the national economy and examines effects of changes in some parameters.

Suggested Citation

  • Zhang, Wei-Bin, 2013. "Education, Local Amenity and Spatial Agglomeration in a Small-Open Multi-Regional Economic Growth Model: Extending the Uzawa-Lucas Model to an Interregional Economy," Business and Economics Research Journal, Uludag University, Faculty of Economics and Administrative Sciences, vol. 4(1), pages 1-28, January.
    • Handle: RePEc:ris:buecrj:0107
    as

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    References listed on IDEAS

    as
    1. Wei-Bin Zhang, 2012. "Capital Accumulation, Technological Progress and Environmental Change in a Three-Sector Growth Model," International Journal of Information Systems and Social Change (IJISSC), IGI Global, vol. 3(3), pages 1-18, July.
    2. Wei-Bin Zhang, 2013. "Flexible Exchange Rate and Growth of a Small Open Monetary Economy with Imported Good and Externalities," Economic Research Guardian, Mutascu Publishing, vol. 3(1), pages 33-53, June.
    3. repec:agr:journl:v:3(580):y:2013:i:3(580):p:31-52 is not listed on IDEAS
    4. Wei-Bin ZHANG, 2013. "Heterogeneous capital and consumption goods in a structurally generalized Uzawa’s model," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(3(580)), pages 31-52, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Wei-Bin Zhang, 2014. "National and International Inequalities in Income and Wealth in a Global Growth with Free Trade and National Inflation Policies," Global Economic Observer, "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences;Institute for World Economy of the Romanian Academy, vol. 2(1), pages 22-40, May.
    2. Wei-Bin Zhang, 2013. "Flexible Exchange Rate and Growth of a Small Open Monetary Economy with Imported Good and Externalities," Economic Research Guardian, Mutascu Publishing, vol. 3(1), pages 33-53, June.

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    More about this item

    Keywords

    Education; human and physical capital; multiple regions; amenity; agglomeration;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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