Shang Yang is regarded as the chief architect of the Chinese state. This paper interprets the Reforms of Shang Yang from the perspective of economics and analyzes the Reforms in a mathematical model. Shang Yang tried to rationalize government administration and to organize the economy more...

How market size and the level of coordination costs determine the degree of specialization is studied in an infinite horizon model with the amount of capital determined endogenously. Firms producing the same intermediate good engage in oligopolistic competition and choose the degree of...

This paper studies a general equilibrium model of rural-urban migration in which manufacturing firms engage in oligopolistic competition and choose increasing returns technologies to maximize profits. Urban residents incur commuting costs to work in the Central Business District. Surprisingly a...

The process of industrialization was accompanied by the switch from household production to firm production. The industrialization process was also a process of population growth, the appearance of general-purpose technologies, and the expansion of international trade. This paper studies the...

Empirical evidence shows that firms located in regions with larger population size are on average larger and more productive. To explain this empirical observation, firms producing intermediate goods are assumed to choose their technologies with different levels of fixed and marginal costs. In...

This paper studies a general equilibrium model of economic geography in which firms engage in oligopolistic competition. This framework is conducive to analytic results. With increasing returns, oligopolistic competition leads to inter-industry trade between regions rather than intra-industry...

This paper studies a Ricardian model of international trade with a continuum of products in a general equilibrium model in which firms engage in oligopolistic competition. It provides a bridge between trade models based on perfect competition and models based on imperfect competition. Compared...

This paper formalizes Rostow’s insight of the role of a leading sector in industrialization in a general equilibrium model. Population growth may lead to a shortage of food and a breakdown of the industrialization process. However, population growth may benefit the manufacturing sector in the...

A firm’s degree of specialization is modeled as the number of different goods it produces. When a firm chooses its degree of specialization, it faces a tradeoff between the fixed cost and the marginal cost of production. A firm’s degree of specialization is shown to increase with the extent...

The interaction among a firm’s choices of output, technology, and monitoring intensity is studied in a general equilibrium model. Firms engage in oligopolistic competition and unemployment is a result of the existence of efficiency wages. The following results are derived analytically. First,...