Integration, Regional Agglomeration and International Trade

32 Pages Posted: 12 Mar 2003

See all articles by Philippe Monfort

Philippe Monfort

Catholic University of Louvain (UCL) - Institut de Recherches Economiques et Sociales (IRES)

Tanguy Van Ypersele

National Center for Scientific Research (CNRS) - Research Group in Quantitative Saving (GREQAM); Centre for Economic Policy Research (CEPR)

Date Written: February 2003

Abstract

In this Paper, we develop a two country four region model allowing for a core periphery pattern inside countries. We then examine how both the integration and the agglomeration process inside a given country affects the pattern of specialization and international trade. We also analyse how agglomeration process interact from one country to the other and in particular how agglomeration forces in one country is affected by the spatial distribution of activity in the partner country. The main results of the analysis are the following: (i) agglomeration proves to be a source of comparative advantages in the industries featuring economies of scale on condition that this agglomeration process is driven by market forces; (ii) both integration and agglomeration in one country reduces the likelihood to observe agglomeration in the partner country.

Keywords: Integration, regional agglomeration, international trade

JEL Classification: F12, F15

Suggested Citation

Monfort, Philippe and Van Ypersele, Tanguy, Integration, Regional Agglomeration and International Trade (February 2003). CEPR Discussion Paper No. 3752. Available at SSRN: https://ssrn.com/abstract=385910

Philippe Monfort (Contact Author)

Catholic University of Louvain (UCL) - Institut de Recherches Economiques et Sociales (IRES) ( email )

3, Place Montesquieu
1348 Louvain-la-Neuve
Belgium
+32 10 473 801 (Phone)
+32 10 473 945 (Fax)

Tanguy Van Ypersele

National Center for Scientific Research (CNRS) - Research Group in Quantitative Saving (GREQAM) ( email )

Centre de la Vieille Charité
2 rue de la Charité
Marseille, 13002
France
+33 4 4293 5983 (Phone)
+33 4 4293 0968 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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