INCORPORATING A SOCIAL NETWORK APPROACH TO MIGRATION, THIS PAPER PROVIDES A PLAUSIBLE EXPLANATION ABOUT THE FORMATION OF URBAN GIANTS. THE MODEL WITHOUT HETEROGENEITY AMONG INDIVIDUALS AND COSTLESS MIGRATION ILLUSTRATES THAT URBANIZATION RESULTS FROM ...
INCORPORATING A SOCIAL NETWORK APPROACH TO MIGRATION, THIS PAPER PROVIDES A PLAUSIBLE EXPLANATION ABOUT THE FORMATION OF URBAN GIANTS. THE MODEL WITHOUT HETEROGENEITY AMONG INDIVIDUALS AND COSTLESS MIGRATION ILLUSTRATES THAT URBANIZATION RESULTS FROM A CENTRAL GOVERNMENT'S EXPENDITURES SUCH AS BAILOUTS TO A LOCAL GOVERNMENT. IN ADDITION, AN URBAN GIANT CAN BE FORMED AS LONG AS THE CENTRAL GOVERNMENT IMPLEMENTS PUBLIC EXPENDITURES ON BOTH URBAN AND RURAL AREA AT THE SAME TIME, BECAUSE WE CAN OBSERVE A DIFFERENT INFORMATION MECHANISM BETWEEN TWO AREAS.