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Journal of Economic Integration 2007 June;22(2) :439-460.
Urban Primacy, Gigantism, and International Trade: Evidence from Asia and the Americas

Ronald L. Moomaw Mohammed A. Alwosabi 

Oklahoma State University
University of Bahrain
Copyright ©2007 Journal of Economic Integration

Gustavsson [1999] finds that policies that promote international trade increase the size of a country's largest city relative to the country's total population, which is defined here as an increase in urban gigantism. In contrast, Ades and Glaeser [1995] report urban gigantism is reduced by freer political institutions and, with less confidence, more open trade. In light of Henderson's (2000) findings that excessive urban concentration inhibits economic growth, these conflicting results for the relationship between openness and urban gigantism (concentration), which are of great interest for the new economic geography, call for additional study. This study uses two measures of urban concentration and finds that lower international-trade costs are associated with lower primacy, but not with lower gigantism. Unlike Gustavsson, however, we find no evidence that lower trade costs increase gigantism.

JEL classification: O18, R12

Keywords: Economic development | Economic geography | Urban Concentration
1. Ades, A.F. and E.L. Glaeser (1995), "Trade and Circuses: Explaining Urban Giants," Quarterly Journal of Economics 110, 195-227.
2. Barro, R.J. (1991), "Economic Growth in a Cross-Section of Countries," The Quarterly Journal of Economics, CVI (2), 407-443.
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