Although a rich and extensive body of theoretical research on new economic geography has emerged, empirical research remains comparatively less well developed. This paper reviews the existing empirical literature on the predictions of new economic geography models for the distribution of income and production across space. The discussion highlights connections with other research in regional an...

This paper studies the spatial economic activity in Turkey and estimates the correlation between wages and consumer demand across NUTS1 regions of Turkey. First, I estimate simple market potential function to test whether closeness to larger markets has impact on wages. Second, I estimate Krugman (1993) economic geography model to see the agglomeration forces in Turkey. The results suggest that...

Acknowledgement I would like to thank Tim Bunnel, Neil Coe, and Kris Olds for their very helpful comments and suggestions. The usual disclaimer applies. Abstract The "firm" has been a contested analytical category in economic geography. Much of neoclassical economic geography takes the firm as a self-contained and homogenous "black box" capable of producing economic outcomes in space. The radic...

New theoretical work on spatial concentration of industry – particularly the ‘new economic geography’ – has significantly helped us understanding why some regions develop more than others, why cities arise and where they are located. However, this work rarely incorporates Adam Smith’s observation that spatial differences in economic activity also reflect variations in physical geography, which ...