HWWI Research - Monocentric Cities, Endogenous Agglomeration, and Unemployment Disparities

Download or read book HWWI Research - Monocentric Cities, Endogenous Agglomeration, and Unemployment Disparities written by and published by . This book was released on with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The model shows that it depends on the level of commuting costs within the cities and on the level of trade costs between the cities whether the unemployment rate is higher or lower in the agglomeration compared with the periphery. [...] When commuting costs are zero, the unemployment rate will always be lower in the agglomeration than that in the periphery.13 Why is the unemployment rate only lower in the agglomeration than it is in the periphery when there is full agglomeration? Consider the case of partial agglomeration where the unem- ployment rate is higher than it is in the periphery. [...] Further, the lower the commuting costs, the larger is the range of transportation costs for which the unemployment rate is lower in the agglomeration compared with the periphery. [...] Further, the area in which the unemployment rate is lower in the agglomeration compared with the periphery is always a subset of the area in which the full agglomeration is stable. [...] This is because the effect of commuting on the attractiveness of a region depends not only on the size of the region, but also on the wages in that region, and thus on the strengths of the centripetal forces.