Geography Reference
In-Depth Information
that has led to this work has been supported by the EU FP6 STREP Project CO3 Common Complex
Collective Phenomena in Statistical Mechanics, Society, Economics, and Biology and by the European
Union NoE DIME. All usual disclaimers apply.
1. The generalization to dif erent numbers of agents in each location will be considered in future work.
Preliminary analysis shows that it doesn't signii cantly modify the results.
2.
This is the same condition found in Forslid and Ottaviano (2003). See Bottazzi and Dindo (2008) for more
details.
3.
Technically our geographical equilibrium corresponds to a Nash equilibrium in pure strategies of the one
shot game where each i rm in a group of
N
has to choose whether to be located in 1 or in 2 and payof s are
given by proi ts.
4.
In the terminology of Bottazzi and Secchi (2007) the intrinsic proi t corresponds to the location's 'intrinsic
attractiveness', whereas the marginal proi t is the 'social externality'.
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