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Agglomeration and Trade: Some Additional Perspectives

The form of agglomeration economies (those internal to the firm as well as those external to it) is reviewed. Consideration is next given to recent changes in the regional (state) economies of the US Midwest, as part of an effort to explore the evolving nature of agglomeration economies. Particular attention is paid to the changing relationship between the establishment and the firm and to radical developments that have affected the transportation sector. The impact of these changes on the nature of interstate trade and on the structure of the metropolitan economy are then examined. There follows a discussion of how agglomeration economies are being supplemented and perhaps replaced by less spatially-constrained advantages. Finally, certain of the more important implications of these various trends are discussed.