Working Paper: CEPR ID: DP7307
Authors: Stephen J. Redding
Abstract: Although a rich and extensive body of theoretical research on new economic geography has emerged, empirical research remains comparatively less well developed. This paper reviews the existing empirical literature on the predictions of new economic geography models for the distribution of income and production across space. The discussion highlights connections with other research in regional and urban economics, identification issues, potential alternative explanations and possible areas for further research.
Keywords: industrial location; market access; multiple equilibria; new economic geography
JEL Codes: F12; F14; O10
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| higher market access (D40) | increased nominal wages (J39) |
| trade liberalizations (F13) | increased economic activity near large markets (R11) |
| increased economic activity near large markets (R11) | increased nominal wages (J39) |