Historical trends of agglomeration to the capital region and new economic geography ¬リニ

a r t i c l e i n f o This paper shows that a family of the Dixit–Stiglitz type of new economic geography models is capable of simulating the real-world tendency for agglomeration to the primate city. It is often observed that while regional populations were dispersed in early times, they have been increasingly concentrated into one capital region over recent years. The present paper thus characterizes the stable equilibrium distribution for any number of regions, any set of interregional distances, and any distribution of immobile demand for sufficiently small or large transport costs. It also demonstrates that multi-region new economic geography models are able to simulate the real-world population distribution trends witnessed over the past few centuries. Since the pioneering work of Krugman (1991), new economic geography (NEG) has been developed and sophisticated in several directions in order to show how the spatial distribution of economic activities is evolving in the real world. Specifically, the alternative modeling strategies proposed by Ottaviano et al. (2002), Forslid and Ottaviano (2003), and Pflüger (2004), among others, have improved analytical tractability, which has enabled researchers to gain further insights into the space economy and its transition. Furthermore, NEG has been enriched by introducing important ingredients such as intermediate goods, commuting costs, land for housing, agricultural transport costs, firm heterogeneity, and economic growth. The scopes of most of the theoretical studies published thus far have been limited to two regions in order for researchers to reach meaningful analytical results. The two-region NEG models tend to demonstrate that spatial distribution is dispersed in the early period (high trade costs or low manufacturing share) and agglomerated in one of the two regions in the late period (low trade costs or high manufacturing share). However, it is no doubt that the two-region NEG models are too simple to describe the spatial distribution of economic activities in real-world economies. Since there are only two regions, their geographical locations are necessarily symmetric, and thus diverse spatial distributions cannot occur. Moreover, it is unlikely that, say, Eastern regions have been growing at the expense of Western regions in a country. Many regions interact both in trade and in migration in the real world, where geographical locations of regions are asymmetric suggesting that their respective transport costs are different. In order to describe such geography, it is indispensable to assume many regions and unequal transport costs between them. Some …