Natalya Naumenko, George Mason University| 23.12.2019

Economic consequences of the 1933 Soviet famine

Krugman (1991):

  • Fixed land, rural population is located in accordance with marginal productivity of land
  • Multiple urbanization equilibria are possible due to mobility of urban capital and increasing returns
  • Temporary shock to urban population or capital can have a persistent impact

Empirical question
Do multiple equilibria exist?