Taxation, Infrastructure, and Endogenous Trade Costs in New Economic Geography

Arbeitspapier

This paper presents a New Economic Geography model with distortionary taxation and endogenized trade costs. Tax revenues finance a public good, infrastructure. We show that the introduction of costly public investment in infrastructure increases agglomerative tendencies. With respect to the regions' sizes, in the periphery, the price-index for manufacturing goods decreases, whereas for the core, the price-index is rather high since the distortionary effect of taxes dominates. 'Free riding' ¡ or, in terms of regional policy, externally funded infrastructure investment; is beneficial for the periphery, which can devote all its tax revenue to local demand support, generating a positive home market effect and driving the catch-up process.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Quaderni - Working Paper DSE ; No. 668

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Models of Trade with Imperfect Competition and Scale Economies; Fragmentation ; Business Taxes and Subsidies including sales and value-added (VAT) ; National Government Expenditures and Related Policies: Infrastructures; Other Public Investment and Capital Stock ; Size and Spatial Distributions of Regional Economic Activity
• Thema: Neue ökonomische Geographie ; Transportkosten ; Steuer ; Infrastrukturinvestition ; Regionalpolitik

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Gruber, Stefan ; Marattin, Luigi
• Ereignis: Veröffentlichung
• (wer): Alma Mater Studiorum - Università di Bologna, Dipartimento di Scienze Economiche (DSE)
• (wo): Bologna
• (wann): 2009

Weitere Informationen

• DOI: doi:10.6092/unibo/amsacta/4578
• Handle: http://hdl.handle.net/10419/159509
• Letzte Aktualisierung: 10.03.2025, 11:45 MEZ