Term
| Reasons why cities are formed |
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Definition
Aggricultur surplus
urban production( exchange for aggriculture)
transportation (method to exchange) |
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Term
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Definition
| price adjusts to local equilibrium |
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Term
| what makes up an agglomoration economy |
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Definition
| Localization economies and urbanization economies |
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Term
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Definition
| benefits from transportation, government (making useful laws) and technology due to clustering firms |
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Term
| what makes up urbanzation economies |
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Definition
| population, common infrastructures (utilities or public transit), availability and diversity of labor and market size |
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Term
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Definition
| intersection of geography and economics |
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Term
| scale economies in exchange |
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Definition
trade workers lie near firms which bid up the land
higher prices of land mean density |
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Term
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Definition
a requirment for a final good
Some firms thrive on making a part for a cheap extremely cheap |
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Term
| benefits of localization econmies |
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Definition
reduce input costs
competition increases among jobs reducing wages |
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Term
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Definition
as output increases costs decrease and eventually 0 economic profit occurs for firms
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Term
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Definition
| production is subject to economies of scale |
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Term
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Definition
self-reinforcing effects generate extreme outcomes
"firms cluster to create extreme outcomes" |
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Term
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Definition
externalities cause inefficiency
(outside forces cause delays or problems)
ex. Traffic on a freeway |
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Term
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Definition
| competiton creates zero economic profit |
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