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DOES TECHNOLOGICAL PROGRESS MAGNIFY REGIONAL DISPARITIES?
Author(s) -
Tabuchi Takatoshi,
Thisse JacquesFrançois,
Zhu Xiwei
Publication year - 2018
Publication title -
international economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.658
H-Index - 86
eISSN - 1468-2354
pISSN - 0020-6598
DOI - 10.1111/iere.12283
Subject(s) - economies of agglomeration , technological change , productivity , industrial organization , economics , manufacturing sector , economic geography , robustness (evolution) , labour economics , falling (accident) , business , microeconomics , economic growth , macroeconomics , biochemistry , chemistry , gene , medicine , environmental health
Abstract We study how technological progress in manufacturing and migration costs interact to shape the space economy. Rising labor productivity in the manufacturing sector fosters the agglomeration of activities, whereas falling transport costs associated with technological and organizational innovations foster their dispersion. Since these two forces have been at work for a long time, the final outcome must depend on how drops in the costs of producing and trading goods interact with the various costs borne by migrants. Various extensions show the robustness of these conclusions.