Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/127226
Authors: 
Quaas, Martin
Lange, Andreas
Year of Publication: 
2004
Series/Report no.: 
Discussion Paper Series, University of Heidelberg, Department of Economics 409
Abstract: 
This paper studies Krugman's (1991) core-periphery model and extends it to include environmental pollution. We present the first analytic proof that only an even spreading of the firms over both of the two regions or a complete agglomeration of all manufacturing firms in one region are possible in Krugman's (1991) model. It is shown that, in a model including local environmental pollution, a third and more realistic type of equilibrium may occur in which most of the manufacturing firm locate in one region, but some manufacturing remains in the other.
Subjects: 
Geographical Economics
Environmental Economics
Pollution
Labor Mobility
JEL: 
R12
J61
Q20
Document Type: 
Working Paper

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