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November 2008

Krugman on Economic Geography

Raj Nallari's picture

Dramatic decreases in costs of transport, communication and information technology should have reduced spatial disparities in economic activities and moved us to a ‘global village.’  Yet, we find that in both industrial and developing countries, economic activities are concentrated in a few centers and there are regional disparities.  For example, about 15 percent of world population live in temperate zones but produce 50 percent of world GDP.  In United States, counties that take up 2 percent of the land area produce more than half of U.S.