199 1 year, Krugman published a paper "Increasing Income and Economic Geography" in the Journal of Political Economy, which made a preliminary discussion on the theory of new economic geography and further expounded his thoughts in a series of subsequent works. The traditional regional economic theory is mainly based on neoclassical economics, and through strict assumptions such as no difference space and no transportation cost, the corresponding location theory and regional growth theory are put forward. Krugman believes that it is precisely because of the lack of tools to analyze "economies of scale" and "imperfect competition" that space issues have long been excluded from mainstream economics. Now, due to the development of analytical tools such as "economies of scale" and "imperfect competition", it is expected that space issues will be brought into the category of mainstream economics.