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Phillipe Martin  had developed a simple, but extremely impressive model of economic development analyzing the interaction
between agglomeration and regional income inequality. The essential philosophy of Martin’s static model had been translated
into a dynamical model, where it can be shown that the interdependence between agglomeration and income disparities satisfies
the conditions of the Lotka-Volterra model, thus implying regular and phase-shifted cycles. By introducing the dynamics of
innovation, the simple two-dimensional model will be extended to a model similar to that developed by Chiarella .