The Genesis of Economic Centers: A Bifurcation Model

Abstract

Fernand Braudel in “Civilization and Capitalism” (1979) designates the lowering of transportation costs as the prime motive force behind the development of the world economy. In his historical treatment of the matter transportation costs are of course very general, including such things as robbery by the medieval knights. Intuitively, it seems sound that specialization and spatial concentrations of population favour efficient mass production using increasing returns and division of labour. That this in turn depends on decreasing the impedance of communication is obvious. In this chapter we want to see how this works out with respect to increasing returns. Later we will return to this issue by taking a closer look at the concentration of population.