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

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  • Giulio Bottazzi
  • Pietro Dindo

Abstract

type="main"> 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

  • Giulio Bottazzi & Pietro Dindo, 2013. "Globalizing Knowledge: How Technological Openness Affects Output, Spatial Inequality, And Welfare Levels," Journal of Regional Science, Wiley Blackwell, vol. 53(4), pages 631-655, October.
    • Handle: RePEc:bla:jregsc:v:53:y:2013:i:4:p:631-655
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    2. José M. Gaspar, 2018. "A prospective review on New Economic Geography," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 61(2), pages 237-272, September.
    3. Ren Lu & Torger Reve & Jing Huang & Ze Jian & Mei Chen, 2018. "A Literature Review Of Cluster Theory: Are Relations Among Clusters Important?," Journal of Economic Surveys, Wiley Blackwell, vol. 32(4), pages 1201-1220, September.

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