Abstract
Rural areas are by definition remote, sparsely populated, and dependent on natural-resource-based industry. Rural remoteness and low density have critical implications for rural firms and households. On the plus side for businesses, rural firms avoid high urban wages, rents, and other congestion costs. Also, they have a competitive edge (low transport costs) in serving rural customers. On the negative side are higher costs of transporting inputs from, and outputs to, urban markets. On the plus side for households is the bucolic environment. On the negative side is the distance that must be travelled to collect the same
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