In this paper we use the NEG framework of the Helpman model to investigate the spatial distribution of wages across German labour market regions under different assumptions. As the assumptions of equal regional price level and equal real wages are strongly rejected for the German economy,...

We study the impact of international long-distance flights on the global spatial allocation of economic activity. To identify causal effects, we exploit variation due to regulatory and technological constraints which give rise to a discontinuity in connectedness between cities at a distance of...

We study the impact of international long-distance flights on the global spatial allocation of economic activity. To identify causal effects, we exploit variation due to regulatory and technological constraints which give rise to a discontinuity in connectedness between cities at a distance of...

In this paper we want to shed some light on the empirical relevance of the new economic geography. Using one of the central features of the core new economic geography models, namely that wages have the tendency to fall the further one moves away from centres of economic activity, we investigate...

We study the effect of international trade and freeness of trade (openness) on interregional inequality within countries. We estimate a model derived from a structural economic-geography approach in which interregional inequality depends on weighted trade shares and trade costs. In addition to...

This paper posits a new approach to the 'wage equation' of the New Economic Geography (NEG). On one side, it is shown that the NEG provides a spatial explanation of marginal costs, instead of wages. On the other side, and focusing on the statistical properties of the data, it is explained why...

Regional disparity is one of the important characteristics of Turkish economy. The paper focuses on the explanatory power of market potential on the regional differences in Turkey. Regional divergences in wages and employment are used as the proxies for regional differences. Empirical results...

In the last ten years the space issue, i.e. the study of the role played by space in economic phenomena, has attracted a lot of interest from many economic fields. The combination of increasing returns, market imperfections, and trade costs creates forces that, together with factor endowments,...

This paper is one of the first attempts to utilize the theoretical framework of the new economic geography for explaining agricultural land prices. We adopt a model proposed by Pflüger and Tabuchi (2010), which allows to consider land as a production factor. We derive a short-run equilibrium...

This paper analyses the level of relative specialisation in terms of gross fixed capital formation in EU regions for the period between 1985 and 1994. Controlling for heteroscedasticity and potential endogeneity problems, we get consistent econometric results. Larger market and regional sizes...