The Dynamics of City Formation.

Working paper

This paper examines city formation in a country whose urban population is growing steadily over time, with new cities required to accommodate this growth. In contrast to most of the literature there is immobility of housing and urban infrastructure, and investment in these assets is taken on the basis of forward-looking behavior. In the presence of these fixed assets cities form sequentially, without the population swings in existing cities that arise in current models, but with swings in hou...

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Authors: Henderson, J; Venables, A

• Publisher: National Bureau of Economic Research, Inc.
• Host title: NBER Working Papers
• Series: NBER Working Papers
• Volume: 13769
• Publication date: 2008-01-01
• Paper number: 13769
• Language: English