Adjustment Costs and Long Run Spatial Agglomerations

We introduce knowledge spillovers as an externality in the production function of competitive firms operating in a finite spatial domain under adjustment costs. Spillovers are spatial as productive knowledge flows more easily among firms located nearby. When knowledge spillovers are not internalized by firms spatial agglomerations may emerge endogenously in a competitive equilibrium, however, they do not emerge at the steady state of the social optimum.

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Year of publication:	2013-07
Authors:	Brock, William ; Xepapadeas, Anastasios ; Yannacopoulos, Athanasios
Institutions:	Fondazione ENI Enrico Mattei (FEEM)
Subject:	Investment Theory \| Adjustment Costs \| Spatial Agglomerations

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Extent:	application/pdf
Series:	Working Papers.
Type of publication:	Book / Working Paper
Notes:	Number 2013.68
Classification:	D21 - Firm Behavior ; R3 - Real Estate Markets, Spatial Production Analysis, and Firm Location ; C61 - Optimization Techniques; Programming Models; Dynamic Analysis
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010693192