We consider two models of a system of cities in which landlords have some power in negotiating rental prices at which land is rented to develop cities. Analysis shows that the equilibrium city size is smaller than the optimal city size in a model in which city sizes are controlled by development...

Unemployment arising from job search and recruiting friction is incorporated in a tax competition model with multiple jurisdictions. Due to the matching externality, for each jurisdiction, the revenue from a job opening does not coincide with its cost. Therefore, capital taxation, which can be...

This paper reviews Paul Krugman's fundamental contributions to new trade theory (NTT) and new economic geography (NEG) on the occasion of his 2008 Nobel Prize. We appraise the impact his work had on the field of regional science broadly defined, and we quantify its influence on papers published...

We investigate how alternative ways of modelling trade costs affect the main results of "new" economic geography. In order to do so, we compare the impacts of falling transport costs and decreasing tariffs on the spatial distribution of economic activities. Our analysis reveals that tariffs and...