1. What are the contributions mentioned in the paper "On spatial dynamics*" ?
The authors critically discuss the literature and present a simple framework that can circumvent some of the main obstacles they identify.. The authors discuss the main characteristics of an equilibrium allocation in this dynamic spatial framework, present a numerical example to illustrate the forces at work, and provide some supporting empirical evidence.
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2. What is the key to making such a rich structure computable?
The key to making such a rich structure computable is that diffusion, together with labor mobility and diversified land ownership, implies that the decisions of where to locateC© 2009, Wiley Periodicals, Inc.7and how much to invest in technology do not depend on future variables.
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3. What is the elasticity of substitution in the service sector?
Assuming an elasticity of substitution less than one, the sector with the higher relative productivity growth loses employment share.
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4. What is the effect of innovation clusters?
Given that innovation clusters coincide with employment clusters, the model is able to generate “spikes” of economic activity, which could be interpreted as cities.
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