FINANCING CITIES IN THE GLOBAL ECONOMY

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FINANCING CITIES IN THE GLOBAL ECONOMY LOCATION
AND GEOGRAPHICAL ECONOMICS Liga Mieze Denis
Assimwe Kangere Bizuneh Gultu Lakew Camilo Mendoza
May 2005 IHS- Rotterdam
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Colombia General Information

• Mid Point between North and South America
• 2 Oceans Atlantic Pacific
• Spanish language

Source Biological Resources Investigation
Institute Alexander Von Humboldt, 2000
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Colombia General Information

• Why Colombia?
• Because of its location could be a bridge
  between North and South America
• In negotiation a Free Trade Treaty with USA
• Analysing a Latin American Country
• 1,141,748 km2 inland 928.660 km2 on water
• Population 46 million
• 72 in cities

Source IGAC
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Urbanisation

• Colombia turned from a mainly rural country to an
  urban one in the last half century as a result
  of
• industrialization / diversification of exports
  (mining products)
• agriculture technology improvement
• development of third sector activities
• rural violence
• high birth rates
• revenue concentration

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36 of the population live in the selected cities
Source Dane
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Simulation Assumptions

• Delta 0.67 reflects the percentage of expenses on
  manufacturing
• Epsilon as provided by model
• Tau(congestion parameter) small deviation large
  deviations used
• Stop criterion and adjustment speed as provided
  by the model
• Initial distribution of mobile immobile workers
  based on the population
• Distances based on time of travel between the
  different cities

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Base Scenario Distribution of Workers
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Scenario 1

• With tau at 0.2 and transport cost fixed at
  1.3,we observe a tendency to spread

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Scenario2

• With tau increased to 0.3 and transport cost
  still fixed at 1.3,we observe a tendency to
  spread to the cities to the far right

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Scenario 3

• With tau at 0.4 and transport cost fixed at
  1.3,we observe a tendency to spread

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Conclusions

• City 12(Tunja) tends to attract the mobile
  workers as the congestion increases
• Promote policies that improve the connectivity of
  the other cities