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THE SPATIAL ORIGIN OF COMMERCE*
Author(s) -
Tse ChungYi
Publication year - 2011
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/j.1468-2354.2011.00631.x
Subject(s) - productivity , production (economics) , economic geography , crowding , cluster (spacecraft) , spatial dispersion , business , economics , international economics , microeconomics , economic growth , physics , optics , neuroscience , computer science , programming language , biology
Although dispersion raises productivity by relieving crowding, concentration promotes trade. The participation of specialist middlemen, who tend to cluster around the regional center, in the trading process would mitigate such tensions, for it becomes less urgent for others to scramble for central locations then from the increase in the density of economic activities around such locations. A city, populated by a cluster of middlemen, that serves as a platform for intermediate trade among producers in surrounding areas can exist without any increasing returns in production, transportation, and exchange. Indirect trade and pure commerce may, thus, have a spatial origin.