On the number and size of cities

We study the effects of a decrease in inter-city transport costson the spatial distribution of population in a multi-regionaleconomy, when a rise in the regional population generates higherurban costs. Holding the number of cities constant, as transportcosts are reduced gradually from a very high level to a verylow level, there is a first phase in which large cities growwhile small cities shrink, a second phase in which both largeand small cities grow while medium size cities shrink, and athird phase in which large cities shrink while small citiesgrow. Furthermore, when the number of cities is allowed to varyas transport costs are reduced from large to small values, itfirst decreases and then increases.