DP2293 Internet Cluster Emergence
|Publication Date:||November 1999|
|Keyword(s):||Distribution Dynamics, Economic Geography, Internet, Location, Space, Time, Toepitz, Waves, Weightless Economy|
|JEL(s):||D30, O10, O18, O33|
|Programme Areas:||International Macroeconomics, International Trade and Regional Economics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=2293|
Internet development holds the promise of transmitting economic value across physical space at zero marginal cost. In such a 'weightless economy', what factors matter for the location of economic activity and thus for economic development? This paper sketches a model of spatial dynamics over a three-dimensional globe, where transportation costs don't matter. The paper develops conditions under which clusters of activity emerge.