Marshallian Externalities, Spatial Self-Organization and Regional Growth — an Agent Based Approach

The aim of the model set up in the previous chapter was to investigate the spatial allocation of production factors and its consequences for the dynamics of regional growth under the hypotheses of Marshallian externalities. Some of the phase spaces of the model displayed multiple equilibria, it was therefore not possible to predict where the factors will settle, although out of equilibria, the model implied a deterministic movement of the variables. Also, the model was limited to two regions, of course a strong simplification. One aim of this chapter is therefore to enlarge the model of the previous section to an arbitrary number of regions. Then the analysis cannot be done in the same way anymore since the number of regional interactions increases more than linearly. The analysis thus becomes technically too complex. Once, more than two regions are considered, the movements out of the equilibria points become merely unpredictable. The process of allocation and convergence to a stable pattern in these kind of models has therefore been described as self-organization. Another aim of this chapter is to make the model’s property of self-organisation explicit.