Spatial inequality, globalization, and footloose capital

Toshiaki Takahashi, Hajime Takatsuka, Dao Zhi Zeng

研究成果: Article査読

35 被引用数 (Scopus)

抄録

This paper shows the equivalence of spatial inequalities in industrial location and in income by revisiting the home market effect (HME) without any homogeneous good based on a reconstructed footloose capital model. In this simple framework, spatial inequalities in industrial location and in income are the HMEs in terms of firm share and wage, respectively. We show that the larger country has a more-than-proportionate share of firms and a higher wage. Furthermore, both the wage differential and the industrial location in the larger country evolve in an inverted U-pattern when transport costs decline. Finally, we analytically examine the effects of trade liberalization on the welfare and show that both countries may gain from globalization.

本文言語English
ページ(範囲)213-238
ページ数26
ジャーナルEconomic Theory
53
1
DOI
出版ステータスPublished - 2013 5月

ASJC Scopus subject areas

  • 経済学、計量経済学

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