Economy of specialization and diseconomy of externalities

• 成果类型: Article
• 署名作者: Chu, CYC; Wang, C
• 署名单位: National Taiwan University; Academia Sinica - Taiwan
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/S0047-2727(98)00024-3
• 发表日期: 1998
• 页码: 249-261
• 关键词: specialization; externalities; division of labor; non-convexity

摘要

Suppose the production of x by agent i causes an externality to the production of y by agent j. A prerequisite for the existence of an externality problem is that i and j are not far apart and are separate agents. But an externality-corrective government policy may make j integrate with i, or move away and start producing both x and y. The above reactions by j essentially change the institutional structure and division of labor, and alter the boundary which differentiates what is internal and what is external. Previous analysis has neglected this aspect for which this paper provides a pioneering analysis. (C) 1998 Elsevier Science S.A.