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New Economic Geography

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  • Eckey, Hans-Friedrich
  • Kosfeld, Reinhold

Abstract

The standard model of New Economic Geography (NEG) presents a synthesis of polarization and neo-classical theories. Within a monopolistic competition framework it aims to explain processes of concentration and deconcentration of manufacturing in a two-sector economy. In this paper the effects of several assumptions of spatial agglomeration processes are addressed. In particular, we investigate the effects of transport costs for agricultural goods, spatial spillovers, the presence of non-tradable services and limited mobility of the labour force. It becomes clear that the tendency towards deconcentration of manufacturing is more marked the higher the transport costs for agricultural goods, the stronger the positive spillovers across the regions, the more income spent on services, the more limited the mobility of the labour force.

Suggested Citation

  • Eckey, Hans-Friedrich & Kosfeld, Reinhold, 2004. "New Economic Geography," Volkswirtschaftliche Diskussionsbeiträge 65, University of Kassel, Faculty of Economics and Management.
    • Handle: RePEc:zbw:kasvdb:65
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    References listed on IDEAS

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    1. Ludema, Rodney D & Wooton, Ian, 1997. "Regional Integration, Trade, and Migration: Are Demand Linkages Relevant in Europe?," CEPR Discussion Papers 1656, C.E.P.R. Discussion Papers.
    2. Paul Krugman & Anthony J. Venables, 1995. "Globalization and the Inequality of Nations," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(4), pages 857-880.
    3. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
    4. Lammers, Konrad & Stiller, Silvia, 2000. "Regionalpolitische Implikationen der neuen ökonomischen Geographie," HWWA Discussion Papers 85, Hamburg Institute of International Economics (HWWA).
    5. repec:hhs:iuiwop:430 is not listed on IDEAS
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    Cited by:

    1. Hans-Friedrich Eckey & Reinhold Kosfeld & Matthias Türck, 2007. "Regionale Entwicklung mit und ohne räumliche Spillover-Effekte," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 27(1), pages 23-42, February.
    2. Chistoph Niederhut-Bollmann & Ludwig Theuvsen, 2008. "Strategic management in turbulent markets: The case of the German and Croatian brewing industries," Journal of East European Management Studies, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 13(1), pages 63-88.
    3. Marcin Bogdanski, 2012. "Modern Theories Of Regional Development – A Review Of Some Concepts," Oeconomia Copernicana, Institute of Economic Research, vol. 3(2), pages 25-41, June.
    4. Kotavaara, Ossi & Antikainen, Harri & Rusanen, Jarmo, 2011. "Population change and accessibility by road and rail networks: GIS and statistical approach to Finland 1970–2007," Journal of Transport Geography, Elsevier, vol. 19(4), pages 926-935.
    5. Karthik Dhandapani & Rajesh S. Upadhyayula & Amit Karna, 2015. "Why do Firms Locate Across Multiple Clusters? Cluster Density, Capabilities and Ethnic Ties," Industry and Innovation, Taylor & Francis Journals, vol. 22(4), pages 251-272, May.

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    More about this item

    Keywords

    Neue Ökonomische Geographie; Transportkosten; nicht handelbare Dienstleistungen; Spillovers; New Economic Geography; transport costs; non-tradable services; spillovers;
    All these keywords.

    JEL classification:

    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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