Suchergebnisse

Abstract We propose a spatial network approach to studying urban configurations by modelling explicitly knowledge transmission, aggregation and spillovers via links formed, as well as by allowing the population and the locality role ('core' versus 'periphery') in each location to be endogenously determined in equilibrium. We establish conditions for the commonly assumed monocentric configuration to arise as the unique and efficient equilibrium outcome. We also illustrate under what circumstances a spatial equilibrium may feature multicentric, urban‐rural, or multiple (disconnected) urban areas and under what conditions each configuration is socially efficient. We further characterize the spatial equilibrium by performing various comparative statics.

AbstractIt is well known that externalities cause fundamental non-convexity problems in the production set. We demonstrate that the differentiable approach is a proper tool. Existence of equilibrium obtains without requiring aggregate convexity in consumption or production. Our model allows general externalities in consumption and production and also price dependency.