A famous argument around geography in economics is that the geographical position of a country has a notable impact on the country’s long-term economic prosperity (Diamond, 1997). Economic activity can be understood by the market size and the amount of trade carried out in these markets. For economic activities and trade, market access needs to be readily accessible.
Market access is an important mechanism through which information and communication can have a spatially distinct effect. …show more content…
Rugged terrains and mountain regions make communication, trade and infrastructure establishment difficult, time-consuming and costly. Geographical frontiers hinder the movement of goods and services between markets within the same territories.
The study on the unification of Italy demonstrates how geographical frontiers curb market access and economic development. Before 1861, Italy was divided into seven states with internal borders separating each state. Internal borders led to barriers in communication, language, currencies, legal institutions and various measures of wealth. The main reason for trade hindrance is the numerous currencies in usage. (Timini 2018; Vicquery 2021). The regions surrounding the borders experienced high economic growth after the unification of