Maharbbal, thanks for the great post. I just wish more AE forumers were more interested in theoretical issues than, say, the endless debates on the ethnic origins of the Turks and the Mongols (no offence to all the Turkish and Mongolian forumers here).
Maharbbal, may I ask you what is the difference between NEG and "traditional" "geographical" economists. It seems to me that both New Economic Geographers and geographical economists are interested in more or less the same issues: industrial districts, special economic zones, regional localization, spatial agglomeration, etc. Are they different in terms of epistemology and methodology? By the way, are the economists REALLY conversing with the geographers when it comes to theory-development or are they pretty much doing their own "economic" stuff? Another skepticism that I have about this "new economic geography" is that does it really deal with cities and regions as living communities with real historical, social, and cultural identities (something that most economists are notorious in ignoring), the way that geographers do?