Premium
Transport costs in new economic geography models: A more realistic approach
Author(s) -
PuenteAjovín Miguel,
SanzGracia Fernando
Publication year - 2021
Publication title -
international journal of economic theory
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.351
H-Index - 11
eISSN - 1742-7363
pISSN - 1742-7355
DOI - 10.1111/ijet.12229
Subject(s) - simple (philosophy) , economics , work (physics) , iceberg , microeconomics , mathematical economics , engineering , geography , mechanical engineering , sea ice , philosophy , epistemology , meteorology
This paper proposes an alternative method to the iceberg approach for modeling transport costs. Instead of part of the good evaporating in transit, we take as our basis the idea that certain workers in companies are in productive occupations in the strict sense, and others work in transport. This simple change is found to be capable of overcoming most of the criticisms associated with the iceberg approach.