Working Paper: NBER ID: w8517
Authors: Donald R. Davis; David E. Weinstein
Abstract: We consider the distribution of economic activity within a country in light of three leading theories - increasing returns, random growth, and locational fundamentals. To do so, we examine the distribution of regional population in Japan from the Stone Age to the modern era. We also consider the Allied bombing of Japanese cities in WWII as a shock to relative city sizes. Our results support a hybrid theory in which locational fundamentals establish the spatial pattern of relative regional densities, but increasing returns may help to determine the degree of spatial differentiation. One implication of these results is that even large temporary shocks to urban areas have no long-run impact on city size.
Keywords: No keywords provided
JEL Codes: F1; R1; J1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| locational fundamentals (R30) | regional population density (R23) |
| increasing returns (I26) | variation in density (C29) |
| WWII bombings (N44) | city sizes (R12) |
| locational fundamentals (R30) | robustness of spatial structures (C49) |
| increasing returns (I26) | recent concentration trends (R23) |
| locational fundamentals (R30) | long-term persistence in regional identities (R23) |