Cyberspace and physical space in a network city.

An urban general equilibrium model with cyberspace and physical space components is constructed and presented. In cyberspace, there is a virtual firm that produces virtual goods. In physical space, a firm is located in the central business district that produces physical goods. The main aim of this work is to study the relationship between cyberspace and physical space in a network city. Spatial structure of telecommunications and transportation networks in the city is also considered by numerical simulation. The spatial configuration of the city is determined through the general equilibrium. It is shown that 2 different configurations emerge depending on the parameters used.