Cities and Skills

Glaeser, Edward L.; Maré, David C.

doi:10.1086/319563

Cited by 1,119 publications

(932 citation statements)

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“…These include differences in human capital (e.g. Rauch, 1993, Glaeser and Mare, 2001, Moretti, 2004b; differences in the cost of living and in the availability and quality of local amenities (e.g. Roback, 1982, Glaeser andGottlieb, 2009); and agglomeration externalities (e.g.…”

Section: Empirical Methodologymentioning

confidence: 99%

Agglomeration, accessibility and productivity: Evidence for large metropolitan areas in the US

et al. 2016

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This paper estimates the productivity gains from agglomeration economies for a sample of the largest metropolitan areas in the United States using measures of urban agglomeration based on employment density and employment accessibility. The latter is a more accurate measure of economic proximity and allows testing for the spatial decay of agglomeration effects with increasing travel time. We find that the productivity gains from urban agglomeration are consistent between measures, with elasticity values between 0.07 and 0.10. The large majority of the productivity gains occur within the first 20 minutes, and do not appear to exhibit significant nonlinearities. INTRODUCTIONThe existence of urban agglomeration externalities implies that the allocation of resources to cities delivers greater productivity gains than non-urban areas. This has policy implications, particularly the rationale for investing in major infrastructure. The design of agglomeration-based policies requires knowledge about the magnitude and the spatial decay of the productivity benefits from urban agglomeration across different regions. In spite of abundant research on the size of productivity gains from spatial agglomeration, there has been insufficient research on the spatial decay pattern of agglomeration effects and the presence of nonlinearities. This study helps towards finding an answer to 2 some of the key remaining questions in the literature, namely: How far and wide do the productivity effects of spatial agglomeration spread and how quickly do they attenuate over space? Are there significant discontinuities in these effects within the urban hierarchy?Previous studies have investigated how agglomeration economies attenuate over space by using accessibility type measures such as market potential, economic mass, and effective density. These measures can be described as a distance weighted sum of opportunities (e.g. employment, population) between pairs of locations and have been used to incorporate the notion of distance decay into the measurement of agglomeration economies. They improve on the more conventional measures based on population and employment densities by providing a better representation of spatial proximity.However, the majority of these studies measure accessibility in terms of physical distance and hence cannot account for the role of (changes in) transport networks on improved connectivity and the subsequent positive effect on productivity. To our knowledge, Lall et al. (2004), Rice et al. (2006), Graham (2007), Holl (2012 and Le Néchet et al. (2012) are the only studies using accessibility type measures based on travel times derived from actual road networks. These studies, however, generally assume a constant rate of decline in agglomeration effects with increased distance/travel time. Only a few studies allow for varying rates of decay with increased distance and overall they suggest a steep decay of agglomeration effects, although they can extend as far as the boundaries of labour markets (e.g. Rice et al

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Section: Empirical Methodologymentioning

confidence: 99%

Agglomeration, accessibility and productivity: Evidence for large metropolitan areas in the US

et al. 2016

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“…Thus, the number of agents that see a change in employment and move is substantial, particularly if they go through a long unemployment spell. 28 The main implication of our model is that individuals with a low income rank in their original location Therefore we …rst estimate the following regression,…”

Section: Moving Decisions After Non-employment Shocksmentioning

confidence: 99%

Location as an Asset

Bilal¹,

Rossi‐Hansberg²

2018

Preprint

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The location of individuals determines their job opportunities, living amenities, and housing costs. We argue that it is useful to conceptualize the location choice of individuals as a decision to invest in a 'location asset'. This asset has a cost equal to the location's rent, and a payo¤ through better job opportunities and, potentially, more human capital for the individual and her children. As with any asset, savers in the location asset transfer resources into the future by going to expensive locations with good future opportunities. In contrast, borrowers transfer resources to the present by going to cheap locations that o¤er few other advantages. As in a standard portfolio problem, holdings of this asset depend on the comparison of its rate of return with that of other assets. Di¤erently from other assets, the location asset is not subject to borrowing constraints, so it is used by individuals with little or no wealth that want to borrow. We provide an analytical model to make this idea precise and to derive a number of related implications, including an agent's mobility choices after experiencing negative income shocks. The model can rationalize why low wealth individuals locate in low income regions with low opportunities even in the absence of mobility costs. We document the investment dimension of location, and con…rm the core predictions of our theory with French individual panel data from tax returns.

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“…In particularly, interpersonal social interaction positively impacts labour market outcomes in cities where the pace of human capital accumulation is accelerated (Glaeser and Maré 2001). Specifically, interacting with, and trust towards, others urban residents (such as neighbours, colleagues and friends) help people obtain information about employment opportunities (Zenou 2008).…”

Section: Analytical Frameworkmentioning

confidence: 99%

Do neighbourhoods have effects on wages? A study of migrant workers in urban China

Cheng

Wang

2013

Habitat International

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Rural-to-urban migrant workers have contributed enormously to the Chinese economy and society in the past three decades. Many of them have concentrated in disadvantaged neighbourhoods and physically and socially suffered from poor residential environment. However it is unclear how the neighbourhoods-as the provision of shelter, social and public service, and community organizing-influence migrant workers' labour market outcomes. To fill this gap, this paper researches the way in which urban neighbourhoods have affected migrant workers' wages. Factors such as housing quality, social interaction and trust, and neighbourhood organization and participation were examined. Results show that five of eight neighbourhood characteristics had statistically significant effects on wages. Robustness tests were conducted to address endogeneity problems of self-selection and unobserved individual ability. Test results demonstrated that our main findings were generally robust, and thus the causality was solid. Abstract: Rural-to-urban migrant workers have contributed enormously to the Chinese economy and society in the past three decades. Many of them have concentrated in disadvantaged neighbourhoods and physically and socially suffered from poor residential environment. However it is unclear how the neighbourhoods-as the provision of shelter, social and public services, and community organizinginfluence migrant workers' labour market outcomes. To fill this gap, this paper explores the way in which urban neighbourhoods have affected migrant workers' wages. Factors such as housing quality, social interaction and trust, and neighbourhood organization and participation were examined. Results show that five of eight neighbourhood characteristics had statistically significant effects on wages. Robustness tests were conducted to address endogeneity problems of self-selection and unobserved individual ability. Test results demonstrated that our main findings were generally robust, and thus the causality was solid.

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Cities and Skills

Cited by 1,119 publications

References 20 publications

Agglomeration, accessibility and productivity: Evidence for large metropolitan areas in the US

Agglomeration, accessibility and productivity: Evidence for large metropolitan areas in the US

Location as an Asset

Do neighbourhoods have effects on wages? A study of migrant workers in urban China

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