German reunication was a positive market access shock for both East and West Germany. Regions that for 45 years had experienced a decline in population due to their loss in market access following the division of Germany of WWII were most strongly affected by this positive shock. We use an...

This paper develops a quantitative model of city structure to separate agglomeration forces, dispersion forces and fundamentals as determinants of location choices. The model remains tractable and amenable to empirical analysis because of stochastic shocks to worker productivity, which yield a...