Asymmetric trading costs and ancient Greek cities
Journal
Economic Theory
ISSN
0938-2259
ISSN-Digital
1432-0479
Type
journal article
Date Issued
2026-10-15
Author(s)
Abstract
Asymmetric trading costs arise when shipping times from point i to point j differ from shipping from point j to i. We show that such asymmetric trading costs predict distinct patterns of location in a class of models using Anderson-Dixit-Stiglitz preferences, where advantage in import market access (or potential) is more beneficial than that in export market access. We bring this prediction to the data, as well as additional ones along the lines of a number of propositions, while also controlling for local micro-geographic characteristics and using data on the location and sizes of cities in ancient Greece. Prevailing winds create an environment of asymmetric and seasonally varying trading costs in ancient Greece. We find that trade potential is strongly associated with the location and size of poleis. The model’s directional prediction is supported when trade potential is measured using the left and right eigenvector centralities implied by the model: import-oriented centrality has a larger coefficient than export-oriented centrality. The result is less robust for alternative reduced-form measures. Using 2SLS methods for population-weighted market access, we find significant differences between export and import market access, with the former often more important than the latter. These findings show that directional asymmetries in trading costs matter for urbanization, while also suggesting that their empirical implications depend on how directional access is measured.
Language
English
Keywords
Ancient urbanization
Intercity trade
Asymmetric trading costs
Intercity travel times
Economic geography
Spatial models
Transportation networks
Network centrality
Systems of cities
Market access
Hellenic poleis
Ancient Greek cities
Ancient Hellenic world
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Springer Science and Business Media LLC
Subject(s)
Division(s)