Different preference for consumption and tax by local government with analysis of firms agglomeration

• Main Authors: Deng-yuan Chi, 紀登元
• Other Authors: Jyh-fa Tsai
• Format: Others
• Language: zh-TW
• Published: 2007
• Online Access: http://ndltd.ncl.edu.tw/handle/59291233698360747734

碩士 === 東吳大學 === 經濟學系 === 95 === The industrial agglomeration is an important issue in Regional Economics. Modifying the model of Forslid and Ottaviano (2003), this study is to explore the agglomeration of manufacturers by assuming that skill labors for manufacturing goods have higher preference than unskill labors. Moreover, the local government tax is introduced to explore the industrial agglomeration following Andersson and Forslid (2003). The findings from this study are as follows. When the transport cost is large, the firms will disperse to two regions equally when the preference of the skill labor is small, and agglomerate to one region when the preference of the skill labor is large. That is, the distribution of firms is dependent on the preference level of skill labor instead of the preference gap between skill labors and unskill labors. In addition, when the local government tax is introduced, the firms will disperse to two regions equally or agglomerate to one region if the transport cost is large.