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A Multiregion Model with Capital Accumulation and Endogenous Amenities

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  • Wei-Bin Zhang

    (Ritsumeikan Asia Pacific University, College of Asia Pacific Management, 1-1, Jumonjibaru, Beppu-shi, Oita-ken 874-8577 Japan)

Abstract

The author develops a multiregional growth model with endogenous amenity and capital accumulation for any number of regions. The simulation results demonstrate that the national dynamics have a unique equilibrium. Comparative statics analysis shows that, if environmental improvement occurs in the technologically advanced (less advanced) region, the national output rises (falls). As a region improves its technology, the other two regions' aggregated output levels fall—not only in relative, but also in absolute, terms. This implies that if any region has a high rate of technological change and the other regions remain technologically stationary, then economic activities will tend to be concentrated in the technologically advancing region. It is also shown that technological differences appear to play only a small role in accounting for spatial wage disparities and endowments.

Suggested Citation

  • Wei-Bin Zhang, 2007. "A Multiregion Model with Capital Accumulation and Endogenous Amenities," Environment and Planning A, , vol. 39(9), pages 2248-2270, September.
    • Handle: RePEc:sae:envira:v:39:y:2007:i:9:p:2248-2270
    DOI: 10.1068/a38393
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    References listed on IDEAS

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