Abstract：For more than a century, the phenomenon of spatial agglomeration of economic activity has been occupying the central position in the study of economic and industrial geography. Since 1980s, there come two kinds of theory model, which are called "the new economic geography", based on the analysis about enterprise behavior to explain the phenomena of industrial agglomeration. The paper systematically compares and analyses the two theory models from the backgrounds, the causes of industrial agglomeration, the natures of market structure, the types of external economy, the transaction relationships and embeddedness, and the motive mechanism of agglomeration. For the backgrounds, over past decade, economic geographers focus on the study of the new industrial districts and the debates of the post-Fordist transition, while a "new trade theory" and "new economics of competitive advantage" pay attention to the regional development. For the causes of the industrial agglomeration, economic geographers emphasize on the flexible specialization and vertical disintegration of production system, while economists trace the initial impetus to the "fortuitous events" and the cumulative causation in the history of regional development. For the natures of market structure, geographers are for the perfect competition and at the same time admit the imperfect competition, while Krugman tends to rely on several models of monopolistic and oligopolistic market structure. For the types of external economy, geography gives rise to external scale and scope economy, while economics pays attention to the internal scale economy and pecuniary external economy. For the transaction relationships and embeddedness, economic geographers believe that local networks and embededness, especially nonmarket transactions, sociocultural and institutional natures, are main characters of the industrial district, while economists emphasize the market relations and internal growth of the enterprises. For the mechanism of industrial agglomeration, geographers focus on the transaction costs, collective learning and innovative capacity, while economists emphasize increasing returns, transportation costs and path dependence. At last, the paper suggests that an exchange of ideas between economics and the various schools of contemporary economic geography will be mutually beneficial.
