The structure of simple 'New Economic Geography' models (or, On identical twins)

By Frédéric Robert-Nicoud. Journal of Economic Geography, 2005

146 citations recorded by the source corpus.

This paper shows that the mathematical structure of the most widely used New Economic Geography models is identical, irrespective of the underlying agglomeration mechanism assumed (factor migration, input-output linkages, endogenous capital accumulation). This enables us to provide analytical proofs to four important and related results in the field. First, standard models display at most two interior steady states beyond the symmetric one. Second, when interior, asymmetric steady-states exist they are unstable. Third, location displays hysteresis. Finally, with forward looking agents a shock to expectations might trigger an equilibrium switch. This paper also stresses the empirical implications of the most important results derived in this study. Copyright 2005, Oxford University Press.

Subfields: Economics and Econometrics, Political Science and International Relations

View Paper: https://www.semanticscholar.org/paper/ba1ac27beaa270a4a09aca08686d0af0b5ed6161

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Citations in the corpus

Putting New Economic Geography to the Test: Free-Ness of Trade and Agglomeration in the EU Regions (2005, background): “This would imply that the Tomahawk (Bell curve) model seems more relevant for corporatist (noncorporatist) countries.”
Agglomeration and Tax Competition (2006, methodology): “Using the techniques of Robert-Nicoud (2005) , it can be shown”
What Can Be Learned from Spatial Economics? (2019, unknown): “The formal stability analysis was developed in Fujita, Krugman, and Venables (1999), but it was not until Robert-Nicoud (2005) that a detailed study of the correspondence of spatial equilibria was provided.”
A simple model of economic geographyal a Helpman-Tabuchi (2005, unknown): “Because both Φ( 4 σ+1 , σ) = 5Note that Robert-Nicoud [14] analyzes the relative magnitude of these two points for a family of economic geography models.”