SPATIAL COMPUTABLE GENERAL EQUILIBRIUM ANALYSIS CONSIDERING AGGLOMERATION ECONOMIES AND WORKERS' RELOCATION

Abstract

 This study conducts spatial computable general equilibrium (SCGE) analyses that consider agglomeration economies and workers' relocation. To this end, we modify the SCGE model developed by Takayama et al.¹⁾ to introduce intra-regional transportation costs. We then examine the effects of changes in transportation costs on the spatial distribution of workers in Japan and show that the prediction of the model is roughly consistent with the data. In addition, we demonstrate through an example that hysteresis phenomena can be observed in the model.