Economies are about trade, and trade costs money. The farther away two place are, the more it costs companies to ship goods and to send people over to meet with subsidiaries, suppliers and customers. Those costs are one of the basic reasons why economic activity tends to cluster together in cities and industrialized regions. It also means that one city or region can get rich by trading with big concentrations of economic activity that are close by -- the wealthier France is, the more it benefits Germany, which can ship cars to France easily since it's close by.
Read Full Article »
