Weber problem in the NEG : a case study of Asia

This paper presents a multi-region model based on the NEG with transport costs of materials. Consumable goods are differentiated among firms, and materials are differentiated among regions. Results show that (i) economic activities increase agglomeration tendencies as the transport cost ratio (materials/goods) decreases, and (ii) location pattern changes, dispersionagglomerationdispersion, with a decline of transport costs. Furthermore, introducing distributions of land and social capital in ten Asian countries, simulation results show that the location of economic activities traces a course of four stages: (i) dispersion, (ii) concentration to China, (iii) concentration to India, and (iv) redispersion.