|Author Name||MORI Tomoya (Faculty Fellow, RIETI)|
|Creation Date/NO.||August 2018 18-E-053|
|Research Project||An Empirical Framework for Studying Spatial Patterns and Causal Relationships of Economic Agglomeration|
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First draft: August 2018
Many large cities are found at locations with certain first nature advantages. Yet, those exogenous locational features may not be the most potent forces governing the spatial pattern of cities. In particular, population size, spacing and industrial composition of cities exhibit simple, persistent and monotonic relationships. Theories of economic agglomeration suggest that this regularity is a consequence of interactions between endogenous agglomeration and dispersion forces. This paper reviews the extant formal models that explain the spatial pattern together with the size distribution of cities, and discusses the remaining research questions to be answered in this literature. To obtain results about explicit spatial patterns of cities, a model needs to depart from the most popular two-region and systems-of-cities frameworks in urban and regional economics in which there is no variation in interregional distance. This is one of the major reasons that only few formal models have been proposed in this literature. To draw implications as much as possible from the extant theories, this review involves extensive discussions on the behavior of the many-region extension of these models. The mechanisms that link the spatial pattern of cities and the diversity in city sizes are also discussed in detail.