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Geographic Concentration and Increasing Returns
Author(s) -
Surico Paolo
Publication year - 2003
Publication title -
journal of economic surveys
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.657
H-Index - 92
eISSN - 1467-6419
pISSN - 0950-0804
DOI - 10.1046/j.1467-6419.2003.00210.x
Subject(s) - economics , economic geography , econometric model , econometrics , returns to scale , macroeconomics , production (economics)
. Economic activities are highly clustered. Why is geographic concentration becoming a predominant feature of industrialized economies? On the basis of the empirical models developed by the new theories of international trade, our answer is that increasing returns are the driving force of economic geography in the US as well as in Europe. In so doing, we review several econometric methods proposed in the literature to separate and to test alternative theoretical paradigms.