The Seamless World: A Spatial Model of International Specialization

39 Pages Posted: 11 Jun 2000 Last revised: 1 Apr 2002

See all articles by Paul R. Krugman

Paul R. Krugman

Princeton University - Woodrow Wilson School of Public and International Affairs; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Anthony J. Venables

University of Oxford; Centre for Economic Policy Research (CEPR)

Date Written: August 1995

Abstract

This paper is an effort to do international trade theory without mentioning countries. Nearly all models of the international economy assume that trade takes place between nations or regions which are themselves dimensionless points. We develop a model in which economic space is instead assumed to be continuous, and in which this 'seamless world' spontaneously organizes itself into industrial and agricultural zones because of the tension between forces of agglomeration and disagglomeration. One might expect such a model to be analytically intractable, but we are able to gain considerable insight through a combination of simulations and an analytical approach originally suggested in a biological context by Alan Turing.

Suggested Citation

Krugman, Paul R. and Venables, Anthony J., The Seamless World: A Spatial Model of International Specialization (August 1995). NBER Working Paper No. w5220. Available at SSRN: https://ssrn.com/abstract=225284

Paul R. Krugman (Contact Author)

Princeton University - Woodrow Wilson School of Public and International Affairs ( email )

Princeton University
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United States
609-258-4570 (Phone)
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Centre for Economic Policy Research (CEPR)

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National Bureau of Economic Research (NBER)

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Anthony J. Venables

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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