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On Austrian regional economics
Author(s) -
Heijman Wim J.M.,
Leen Auke R.
Publication year - 2004
Publication title -
papers in regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.937
H-Index - 64
eISSN - 1435-5957
pISSN - 1056-8190
DOI - 10.1111/j.1435-5597.2004.tb01919.x
Subject(s) - austrian school , praxeology , sketch , economics , regional science , economies of agglomeration , regional economics , regional development , neoclassical economics , economic geography , sociology , economic growth , microeconomics , algorithm , computer science
Abstract. The aim of this research note is two‐fold, firstly, to clarify the growing interaction between regional science and Austrian economics and their awareness of each other. We elucidate the Austrian methodology, called praxeology, which is especially misunderstood in regional science. Secondly, we tentatively sketch a possible contribution of Austrian economics to regional science. The core of the new economic geography is the idea of external economies of scale. Agglomeration of firms often leads to lower costs of existing products, and is a stimulating environment for the invention of new products and the development of new ideas. Austrian economics, which places discovery at the centre of its analysis of the market process, should be able to explain why (public) regional investments may be unsuccessful and why they can be successful.