EFFICIENCY AND INTER-REGIONAL FACTOR MOBILITY - A NOTE
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In this note, the two-region model presented in Flatters, Henderson and Mieszkowski (4) is modified to include capital mobility. The efficiency conditions for this modified model are derived and contrasted with a free mobility equilibrium. Although the efficiency conditions are not radically altered, the addition of capital mobility tends to strengthen the finding that an uncoordinated free mobility equilibrium will not result in an efficient allocation of resources. 1982 Annals of Regional Science.