Geography, Trade Patterns, and Economic Policy
February 1, 1994
More Formats on IMF eLibrary
Order a Print CopyDisclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
Summary
This paper presents a geographical theory of location and interregional trade. Location is treated as an endogenous variable by firms, consumers and perfectly mobile workers in a two-sector economy. Space plays a central role owing to transportation costs, market access, and distance from polluting industrial centers. The model is used to examine: (1) aspects of a compensating-differential theory of regional unevenness, (2) the theoretical formulation of a gravity theory of trade patterns, (3) the geographic basis for industrial and environmental policy, and (4) the interaction between reductions in transportation costs, location patterns, and technological improvements.
Subject: Agricultural sector, Economic sectors, Labor, Manufacturing, National accounts, Transportation, Wages
Keywords: Agricultural sector, Asia and Pacific, cost of living, cost reduction, Eastern Europe, Global, increasing returns, increasing returns to scale, Manufacturing, North America, resource allocation, trade pattern, Transportation, transportation cost, Wages, WP
Pages:
44
Volume:
1994
DOI:
Issue:
016
Series:
Working Paper No. 1994/016
Stock No:
WPIEA0161994
ISBN:
9781451843330
ISSN:
1018-5941
