Globalizing Knowledge: How Technological Openness Affects Output, Spatial Inequality, and Welfare Levels

25 Pages Posted: 30 Mar 2017

See all articles by Giulio Bottazzi

Giulio Bottazzi

Scuola Superiore Sant'Anna di Pisa - Laboratory of Economics and Management (LEM)

Pietro Dindo

Ca Foscari University of Venice - Dipartimento di Economia

Date Written: October 2013

Abstract

Using an analytically solvable model, we study how the spatial distribution of economic activities and the ensuing welfare levels are affected by pecuniary externalities, depending on transportation costs, and localized technological externalities, due to the cost saving effect of intra‐ and interregional knowledge spillovers. Under the assumption of capital mobility and labor immobility, we show that increasing interregional knowledge spillovers, i.e., promoting technological openness, favors a smoother transition between different levels of firms concentration, makes trade globalization less likely to generate catastrophic and irreversible agglomeration, and ultimately leads to a less uneven distribution of welfare.

Suggested Citation

Bottazzi, Giulio and Dindo, Pietro, Globalizing Knowledge: How Technological Openness Affects Output, Spatial Inequality, and Welfare Levels (October 2013). Journal of Regional Science, Vol. 53, Issue 4, pp. 631-655, 2013, Available at SSRN: https://ssrn.com/abstract=2943110 or http://dx.doi.org/10.1111/jors.12034

Giulio Bottazzi (Contact Author)

Scuola Superiore Sant'Anna di Pisa - Laboratory of Economics and Management (LEM) ( email )

Piazza Martiri della Liberta, 33
Pisa, I-56127
Italy
+39-050-883343 (Phone)
+39-050-883344 (Fax)

Pietro Dindo

Ca Foscari University of Venice - Dipartimento di Economia ( email )

Cannaregio 873
Venice, 30121
Italy

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