Network external economies in the Coffee Region and Pereira's economic growth

Abstract

Recent developments in urban economics suggest that cities tend to organize themselves in networks, thereby creating interactions that prompt economic growth among their nodes. The purpose of this article is to provide evidence about the network relations that are being created in the coffee region, the associated generation of external economies, and their impact on Pereira's economic growth. To demonstrate this point, the population flux between cities for traveling purposes was revised in order to ascertain the impact that these interactions have had on Pereira's economic growth. The article also shows the causality relations between the economic dynamics of the coffee region's cities over the years 1996–2010, which evidences a strong relation between the economic dynamics of the region and Pereira's economic growth.