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CEP discussion paper

Spatial Frictions


The world is replete with spatial frictions. Shipping goods across cities entails trade frictions. Commuting within cities causes urban frictions. How important are these frictions in shaping the spatial economy? We develop and quantify a novel framework to address this question at three different levels: Do spatial frictions matter for the city-size distribution? Do they affect individual city sizes? Do they contribute to the productivity advantage of large cities and the nature of competition in cities? The short answers are: no, yes, and it depends.


Kristian Behrens, Giordano Mion, Yasusada Murata and Jens Südekum

20 December 2011     Paper Number CEPDP1108

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This CEP discussion paper is published under the centre's Trade programme.