1. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

3. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

4. Introduction International Trade & the World Economy;  Charles van Marrewijk Paul Krugman (1953 - )

5. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

6. Zipf's Law and the gravity equation International Trade & the World Economy;  Charles van Marrewijk

7. Zipf's Law and the gravity equation International Trade & the World Economy;  Charles van Marrewijk

8. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

9. The structure of the model International Trade & the World Economy;  Charles van Marrewijk

10. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

11. Multiple locations and equilibrium International Trade & the World Economy;  Charles van Marrewijk

12. Multiple locations and equilibrium International Trade & the World Economy;  Charles van Marrewijk Price index equation Income equation Wage equation (from demand = supply in manufactures sector Short-run equilibrium; given the distribution of manufacturing labour

13. Multiple locations and equilibrium International Trade & the World Economy;  Charles van Marrewijk Three examples

14. Multiple locations and equilibrium International Trade & the World Economy;  Charles van Marrewijk Manufacturing labour force adjustment

15. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

16. Chapter 14 tool: computer simulations International Trade & the World Economy;  Charles van Marrewijk

17. Chapter 14 tool: computer simulations International Trade & the World Economy;  Charles van Marrewijk

18. Chapter 14 tool: computer simulations International Trade & the World Economy;  Charles van Marrewijk

19. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

20. Welfare International Trade & the World Economy;  Charles van Marrewijk

21. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

22. Application: predicting the location of European cities International Trade & the World Economy;  Charles van Marrewijk

23. Introduction Zipf's Law and the gravity equation The structure of the model Multiple locations and equilibrium Chapter 14 tool: computer simulations Welfare Application: predicting the location of European cities Conclusions CHAPTER 14; GEOGRAPHICAL ECONOMICS International Trade & the World Economy;  Charles van Marrewijk

24. Conclusions International Trade & the World Economy;  Charles van Marrewijk Combining various international economic theories with factor mobility provides a simple theory of location and agglomeration. Distinction short-run equilibrium (given distribution of the manufacturing labour force) and long-run equilibrium (endogenously determined by equality of real wages). Distinction stable equilibrium and unstable equilibrium. Using computer simulations: high transport costs lead to spreading of economic activity low transport costs lead to agglomeration of economic activity intermediate transport costs lead to multiple long-run equilibria Extensions of the basic model can explain empirical regularities, such as Zipf’s Law and the Gravity Equation.