Spatial distribution of economic activities and transboundary pollution

We investigate the impacts of pollution in terms of economic agglomerations by extending the short-run equilibrium results of Ottaviano´s (2001) core-periphery model. Our aim is to show that the range of possible spatial configurations is enlarged when we consider parameters of environmental pollution. Besides the three standard NEG cases related to transport costs level, this will permit us to identify other cases depending on environmental parameters value.