CIRJE-F-414 "Self-organizing Urban Hierarchy"
Author Name Tabuchi, Takatoshi and Jacques-Francois Thisse
Date April 2006
Full Paper PDF file@
Remarks @Subsequently published in Journal of Urban Economics 69, 240-252, 2011.

We have considered a general equilibrium model with monopolistically competitive markets, in which urban centers are service suppliers to all the agricultural regions as well as to the other urban centers. We have retained the forward and backward linkages of NEG to generate the agglomeration of firms and workers in cities. Our main result is that central places arise endogenously when transport costs take intermediate values.