Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/34586 
Year of Publication: 
2007
Series/Report no.: 
IZA Discussion Papers No. 2862
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
This paper provides a simple theory of geographical mobility which simultaneously explains people's choice of residences in space and the location of industry. Residences are chosen on the basis of the utility which mobile households obtain across locations. The spatial pattern of industry is determined by the location decision of a scarce essential factor of production which seeks to obtain the highest possible economic return. Our theory comprehends applications to commuting and physical capital mobility. Referring to the decline in mobility costs, we are able to explain that long-distance commuting and foreign direct investment have increased and that industrial activity has become more concentrated both within as well as across countries.
Document Type: 
Working Paper

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