nep-geo New Economics Papers
on Economic Geography
Issue of 2005‒01‒02
thirty-six papers chosen by
Vassilis Monastiriotis
London School of Economics

  1. Communication Externalities in Cities By Sylvie Charlot; Gilles Duranton
  2. Spatial Disparities in Developing Countries: Cities, Regions and International Trade By Anthony J. Venables
  3. Cities, Matching and the Productivity Gains of Agglomeration By Fredrik Andersson; Simon Burgess; Julia Lane
  4. Spatial Determinants of Productivity: Analysis for the Regions of Great Britain By Patricia Rice; Anthony J. Venables
  5. Zipfs Law for Cities: A Cross Country Investigation By Kwok Tong Soo
  6. Timeliness, Trade and Agglomeration By James Harrigan; Anthony J. Venables
  7. Relative Wage Variation and Industry Location By Andrew B. Bernard; Stephen Redding; Peter K. Schott; Helen Simpson
  8. The Geography of UK International Trade By Henry G. Overman; L. Alan Winters
  9. The Incidence of UK Housing Benefit: Evidence from the 1990s Reforms By Steve Gibbons; Alan Manning
  10. Congestion and tax competition in a parallel network By De Borger B.; Proost S.; Van Dender K.
  11. Economic Geography: Real or Hype? By Jun Koo; Somik V. Lall
  12. Increasing the Economic Development Benefits of Higher Education in Michigan By Timothy J. Bartik
  13. Equilibrium and the core in Alonso's discrete population model of land use By Berliant,M.; Raa,M.H. ten
  14. Neighbourhood Management and the Future of Urban Areas By Anne Power
  15. Schools in Disadvantaged Areas: Recognising context and raising quality By Ruth Lupton
  16. Urban Social Exclusion in Transitional China By Bingqin Li
  17. Why So Much Centralization? A Model of Primitive Centripetal Accumulation By Jean-Paul Faguet
  18. Significance and Determination of Fees for Municipal Finance By Peter Friedrich; Anita Kaltschuetz; Chang Woon Nam
  19. Gatekeepers of knowledge within industrial districts:who they are, how they interact. By Andrea Morrison
  20. Entrepreneurship in the EU: to wish and not to be By Isabel Grilo and; Jesus Maria Irigoyen
  21. Regional Variations in Adult Learning and Vocational Training: Evidence from NCDS and WERS 98 By Andrew Jenkins; Alison Wolf
  22. Evolving Cityscapes: Agglomeration and Specialization with Mobile Labor and Vertical Linkages By Souleymane Coulibaly
  23. Buzz: Face-to-Face Contact and the Urban Economy By Michael Storper; Anthony J. Venables
  24. Why Executive Power Centralizes Government By Samuel A. Baker
  25. Relief Through Development: Maize Market Liberalization in Urban Kenya. By Gem Argwings-Kodhek; T.S. Jayne
  26. Bargaining over Residential Real Estate: Evidence from England (Third Version) By Antonio Merlo; François Ortalo-Magné
  27. How the Dragon Captured the World Export Markets: Outsourcing and Foreign Investment Lead the Way By F. Gerard Adams; Byron Gangnes; Yochanan Shachmurove
  28. Transport tax reform, commuting and endogenous values of time By De Borger Bruno; Van Dender Katrien
  29. Endowments, Market Potential, and Industrial Location: Evidence from Interwar Poland (1918-1939) By Nikolaus Wolf
  30. Valuing Rail Access Using Transport Innovations By Steve Gibbons; Stephen Machin
  31. Padding Required: Assessing the Economic Impact of the Super Bowl By Victor Matheson; Robert Baade
  32. Mega-Sporting Events in Developing Nations: Playing the Way to Prosperity? By Victor Matheson; Robert Baade
  33. Determinants of Appalachia's Persistent Poverty By Robert Baumann
  34. Welfare and Work in the 1990s: Experiences in Six Cities By Peter R. Mueser; Christopher T. King
  35. Openness, Income and Growth in China By Ting Gao; Yuwei Wang
  36. Evaluating Urban Transport Improvements: Cost Benefit Analysis in the Presence of Agglomeration and Income Taxation By Anthony J. Venables

  1. By: Sylvie Charlot; Gilles Duranton
    Abstract: To identify communication externalities in French cities, we exploit a unique survey recording workplacecommunication of individual workers. Our hypothesis is that in larger and/or more educated cities, workersshould communicate more. In turn, more communication should have a positive effect on individual wages. Byestimating both an earnings and a communication equation, we find evidence of communication externalities.Being in a larger and more educated city makes workers communicate more and in turn this has a positiveeffects on wages. However, only a small fraction of the overall effects of a more educated and larger city onwages percolates through this channel.
    Keywords: human capital, cities, communication externalities
    JEL: J31 R19 R29
    Date: 2003–11
  2. By: Anthony J. Venables
    Abstract: Spatial inequality in developing countries is due to the natural advantages of some regionsrelative to others and to the presence of agglomeration forces, leading to clustering ofactivity. This paper reviews and develops some simple models that capture these first andsecond nature economic geographies. The presence of increasing returns to scale in citiesleads to urban structures that are not optimally sized. This depresses the return to jobcreation, possibly retarding development. Looking at the wider regional structure,development can be associated with large shifts in the location of activity as industry goesfrom being inward looking to being export oriented.
    Keywords: cities, spatial disparities, urbanisation, developing countries
    JEL: R1 R12 O18
    Date: 2003–11
  3. By: Fredrik Andersson; Simon Burgess; Julia Lane
    Abstract: The striking geographical concentration of economic activities suggests that there are substantial benefits toagglomeration. However, the nature of those benefits remains unclear. In this paper we take advantage of a newdataset to quantify the role of one of the main contenders - the matching of workers and jobs. Using individuallevel data for two large US states we show that thicker urban labour markets are associated with moreassortative matching between workers and firms. Another critical condition is required for this to generatehigher productivity: complementarity of worker and firm quality in the production function. Usingestablishment level productivity regressions, we show that such complementarity is found in our data. Puttingtogether the production and matching relationships, we show that production complementarity and assortativematching is an important source of the urban productivity premium.
    Keywords: Urban Productivity, Matching, Agglomeration
    JEL: R23 R12 J24
    Date: 2004–09
  4. By: Patricia Rice; Anthony J. Venables
    Abstract: This paper uses NUTS3 sub-regional data for Great Britain to analyse the determinants of spatialvariations in income and productivity. We decompose the spatial variation of earnings into aproductivity effect and an occupational composition effect. For the former (but not the latter) wefind a robust relationship with proximity to economic mass, suggesting that doubling thepopulation of working age proximate to an area is associated with a 3.5% increase in productivityin the area. We measure proximity by travel time, and show that effects decline steeply with time,ceasing to be important beyond approximately 80 minutes.
    Keywords: regional disparities, productivity, clustering
    JEL: R1 O4
    Date: 2004–07
  5. By: Kwok Tong Soo
    Abstract: This paper assesses the empirical validity of Zipf¿s Law for cities, using new data on 73countries and two estimation methods ¿ OLS and the Hill estimator. With either estimator,we reject Zipf¿s Law far more often than we would expect based on random chance; for 53out of 73 countries using OLS, and for 30 out of 73 countries using the Hill estimator. TheOLS estimates of the Pareto exponent are roughly normally distributed, but those of the Hillestimator are bimodal. Variations in the value of the Pareto exponent are better explained bypolitical economy variables than by economic geography variables.
    Keywords: Cities, Zipf¿s Law, Pareto distribution, Hill estimator
    JEL: C16 R12
    Date: 2004–07
  6. By: James Harrigan; Anthony J. Venables
    Abstract: An important element of the cost of distance is time taken in delivering final and intermediategoods. We argue that time costs are qualitatively different from direct monetary costs such asfreight charges. The difference arises because of uncertainty. Unsynchronised deliveries candisrupt production, and delivery time can force producers to order components beforedemand and cost uncertainties are resolved. Using several related models we show that thiscan cause clustering of component production. If final assembly takes place in two locationsand component production has increasing returns to scale, then component production willtend to cluster around just one of the assembly plants.
    Keywords: Just- in-time, clustering, location, trade.
    JEL: F1 L0
    Date: 2004–02
  7. By: Andrew B. Bernard; Stephen Redding; Peter K. Schott; Helen Simpson
    Abstract: Relative wages vary considerably across regions of the United Kingdom, with skill-abundantregions exhibiting lower skill premia than skill-scarce regions. This paper shows that thelocation of economic activity is correlated with the variation in relative wages. U.K. regionswith low skill premia produce different sets of manufacturing industries than regions withhigh skill premia. Relative wages are also linked to subsequent economic development: overtime, increases in the employment share of skill- intensive industries are greater in regionswith lower initial skill premia. Both results suggest firms adjust production across and withinregions in response to relative wage differences.
    Keywords: Deindustrialization, Relative Factor Prices, Diversification Cones
    JEL: F11 F14 C14
    Date: 2004–02
  8. By: Henry G. Overman; L. Alan Winters
    Abstract: This paper examines how the geography of UK international trade has changed since the UK¿s accession tothe European Economic Community using a newly constructed data set that gives a detailed breakdown ofthe UK¿s imports and exports by both port of entry and exit and commodity. Our results suggest thatbetween 1970 and 1992 overall imports and exports re-orientated in favour of ports located nearer to thecontinent. The vast majority of individual commodities also saw a similar re-orientation.
    Keywords: UK trade, EEC, economic geography
    JEL: F15 F14 R12
    Date: 2004–01
  9. By: Steve Gibbons; Alan Manning
    Abstract: Housing Benefit (HB) in the UK subsidizes the rent of tenants in both the private and publicsectors. Its share in total welfare benefits has risen markedly through time and there iswidespread dissatisfaction with it. But, reform has been very slow. One important issue isthe extent to which the incidence of HB is actually on the tenants. Exploiting two data setsfrom the mid-1990s when the subsidy regime changed for some tenants but not for others,this paper explores the incidence. We find that some of the incidence is on landlords thoughour two data sets differ in the extent to which this is true. We also find evidence in support ofa ¿matching¿ model of the rental market rather tha n a perfectly competitive one.
    Keywords: Housing Subsidies, Tax Incidence
    JEL: H22 R31
    Date: 2003–12
  10. By: De Borger B.; Proost S.; Van Dender K.
    Abstract: The purpose of this paper is to study tax competition on a parallel road network when different governments have tolling authority on different links of the network. Reflecting many current situations in Europe, each link is used by both local and transit traffic, and transit has a choice of route. Each government maximises the surplus of local users plus total tax revenues in controlling local and transit transport. Three types of tolling systems are considered: (i) toll discrimination between local traffic and transit, (ii) uniform tolls on local and transit transport, (iii) local tolls only. The results suggest that the welfare effects of introducing transit tolls are large, but that differentiation of tolls between local and transit transport as compared to uniform tolls does not yield large welfare differences. Moreover, the welfare effects of coordination between countries are relatively small in comparison with the welfare gains of tolling transit. Numerical application of the model further illustrates the effects of different transit shares and explicity considers the role of asymmetries between countries. Higher transit shares strongly raise the Nash equilibrium transit toll and slightly decrease local tolls. With asymmetric demands, the welfare gains of introducing differentiated tolling rise strongly for the country with lower local demand.
    Date: 2004–03
  11. By: Jun Koo; Somik V. Lall (World Bank)
    Abstract: Economic geography has become a mantra for many economists, geographers, and regional scientists. Previous studies have tested the importance of economic geography for production activities and found a significant association between them. Most of these studies, however, have not taken into account that economic geography influences location decisions at the firm level. Koo and Lall show a potential bias that can arise when firm location choices are not considered in estimating the contribution of economic geography to industry performance. Their analysis using microdata of Indian manufacturing firms shows there is an upward bias in the contribution of economic geography to productivity when firm location choices are not considered in the analysis. This paper—a product of the Infrastructure and Environment Team, Development Research Group—is part of a larger effort in the group to examine industry location decisions. The study was partly funded by the Bank’s Research Support Budget under the research project "Urbanization and the Quality of Life.”
    Keywords: Infrastructure; Industry
    Date: 2004–12–30
  12. By: Timothy J. Bartik (W.E. Upjohn Institute for Employment Research)
    Abstract: This paper considers how a state such as Michigan can increase the economic development benefits of higher education. Research evidence suggests that higher education increases local economic development principally by increasing the quality of the local workforce, and secondarily by increasing local innovative ideas. These economic development benefits of higher education can be increased by: 1) competent management of conventional economic development programs that focus on business attraction and retention; 2) policies that focus on increasing local job skills by educating the state's residents, as opposed to attracting in-migrants; 3) policies that address specific "market failures" in how higher education leads to increased workforce quality or business innovations.
    Keywords: education, higher, economic, development, Michigan, Bartik, Upjohn
    JEL: R58 I28 H72
    Date: 2004–09
  13. By: Berliant,M.; Raa,M.H. ten (Tilburg University, Center for Economic Research)
    Abstract: Conventional wisdom tells us that with no market failure and local non-satiation of preferences, the core is at least as large as the collection of competitive equilibrium allocations. We con.rm this for a standard model featuring land. Next we consider the public land ownership version of the model. If the role of land ownership and rent distribution is assumed by a government that ploughs back rent (at least in excess of its agricultural value) to its citizens, the equilibrium remains efficient, but no longer need be in the core.
    JEL: H42 R13 R52 D51 D61
    Date: 2004
  14. By: Anne Power
    Abstract: This paper is about low-income neighbourhoods, their organisation and management. It is not a study in deprivation, but is about problem-solving, about the reforms in delivery underway in Britain, about long run attempts to change neighbourhood conditions and environments, about the central role of local government and housing organisations in tackling ground-level problems. It addresses environmental and social problems within neighbourhoods as part of a wider understanding of social exclusion, sustainable development and the need for greater care of our urban communities. Although its perspective is shaped by British examples, many of the issues are relevant to other countries. Although its focus is on low-income urban neighbourhoods of predominantly rented housing, the ideas can be applied to any neighbourhood of whatever tenure, size or location. This revised up-dated edition takes account of the ODPM's Neighbourhood Renewal Unit, and the Neighbourhood Management and Neighbourhood Warden Schemes they are supporting.
    Keywords: social housing, neighbourhoods, area regeneration
    JEL: I30
    Date: 2004–01
  15. By: Ruth Lupton
    Abstract: Both educational attainment and school quality are typically lower in disadvantaged areas than others and much recent policy attention has been focused on each. This paper looks at the quality problem, exploring the relationships between disadvantaged contexts, what schools do, and the quality of schooling that they provide. The findings suggest that disadvantaged contexts impact on the organisation and processes of schools and that these effects differ significantly from one area to another, in ways that are not reflected by the usual indicators of disadvantage. School managers respond by adapting organisational design and processes. They are, however, constrained in these responses by the limited and short-life funding available, by the lack of evidence of good practice in specific contexts, and by lack of flexibility over major issues of organisation design and curriculum. Challenging contexts and the constraints on school responses together exert a downward pressure on quality. The paper argues that because school processes and quality are affected by context, school improvement in disadvantaged areas will not be achieved by generic measures, but only by policies tailored to disadvantaged areas and sensitive to differences between these areas. It suggests ways in which school improvement policies could be contextualised in order to raise quality in the poorest areas.
    Keywords: education, schools, poverty, area deprivation, neighbourhoods, quality, OFSTED, educational attainment, context
    JEL: I28 R00
    Date: 2004–01
  16. By: Bingqin Li
    Abstract: This paper demonstrates that urban social exclusion in China does not only include restricted participation by the ¿underclass¿ in urban life, but also the deprivation of certain political, social and economic rights. In addition, the paper describes how the character of urban social exclusion has changed over time. The author also examines the social exclusion of rural workers living and working in urban areas. The paper concludes by arguing that urban social exclusion in China needs coordinated reforms that target the whole set of problems in the urban ¿underclass¿ lacking political rights, social protection and economic opportunities.
    Keywords: social exclusion, urban China, rural to urban migrants
    JEL: J43 R23 I30
    Date: 2004–03
  17. By: Jean-Paul Faguet
    Abstract: With strong conceptual arguments in its favor, decentralization is a popular and growing policy trend across the world. And yet dozens of empirical studies have failed to find convincing evidence that past reforms have worked. This begs two questions: 1)Why does decentralization produce indifferent results? and 2) Why is there so much centralization in the first place? The paper develops a simple model of a legislature in which municipal representatives bargain with central government agents over the allocation of public resources. By locating central government in a particular geographic space ¿ the ¿capital¿ ¿ and invoking self-interest on the part of its residents, I can answer both questions. I introduce the concept of residual power, which underpins the model and determines the flow of resources to districts. There is so much centralization because residual power is located in the capital, whose residents directly benefit from weak local governments.
    Keywords: Centralization, decentralization, local public goods, local government, municipal government, legislative bargaining, capture.
    Date: 2004–06
  18. By: Peter Friedrich; Anita Kaltschuetz; Chang Woon Nam
    Abstract: The idea of fiscal decentralisation has become increasingly fashionable world-wide. But every country has unique features of the intergovernmental fiscal system. In general municipal expenditures are rapidly growing in European countries. On the other hand local tax increases are not easily enforceable at present, whereas the local fiscal autonomy is unlikely to be guaranteed as long as municipalities are strongly dependent on down-flow grants. In such a fiscal-stress situation an improvement of local fiscal capacity can be achieved from the increase of fees. Four European countries were chosen to survey the recent development of municipal finance: Britain, Germany, Poland and Switzerland. This paper firstly identifies and highlights the similarities and differences in municipal finance in an international context. Secondly it theoretically examines the possibility of enhancing fiscal autonomy of local governments through determining optimal fee level which leads to an increase of revenues from this revenue item.
    Keywords: fiscal decentralisation, local expenditures and taxes, fees, shared taxes, intergovernmental transfers, municipal borrowings, Poland, Britain, Switzerland, Germany
    JEL: H20 H40 H60 H70 H80
    Date: 2004
  19. By: Andrea Morrison (University of Piemonte Orientale, Novara, Italy,)
    Abstract: A great amount of recent studies dealing with industrial clustering suggests that the innovative performance of industrial districts is strictly linked with their ability to absorb external knowledge. This paper aims at identifying and analysing the main actors involved in this process. We investigate to what extent leading firms located within a successful Italian furniture district behave as gatekeepers of knowledge. Empirical analysis has been carried out on a sample of technicians working within firms’ knowledge intensive units. Adopting social network techniques we are able to trace linkages between technicians and external sources of knowledge and to evaluate their relevance for innovative activities. Our findings suggest that leading firms absorb external knowledge and spread it only to their own network of clients and providers. According to our theoretical framework we argue that leading firms cannot be interpreted as knowledge gatekeepers.
    Keywords: Knowledge flows; Industrial districts; Leader firms; Social networks.
    JEL: O31 R0 Z13
    Date: 2004–11
  20. By: Isabel Grilo and; Jesus Maria Irigoyen
    Abstract: It is now widely acknowledged that the entrepreneurial capacity in an economy is a key determinant of economic growth and productivity improvements. This paper uses survey data from the 15 EU Member States and the US to establish the effect of demographic and other variables on latent and actual entrepreneurship. Latent entrepreneurship is measured by the probability of a declared preference for self-employment over employment. Other than demographic variables such as gender, age and education level, the set of explanatory variables used includes country specific effects, the perception by respondents of administrative complexities and of availability of financial support and a rough measure of risk tolerance. The most striking result is the lack of explanatory power of the perception of lack of available financial support in the latent entrepreneurship equation.
    Keywords: Entrepreneurship, self-employment, administrative complexities, access to finance, risk attitudes, probit regression
    JEL: M13 J23 R12
    Date: 2004–12
  21. By: Andrew Jenkins; Alison Wolf
    Date: 2004–01
  22. By: Souleymane Coulibaly
    Abstract: In "new economic geography" models, spatial concentration typically arises either because of worker mobility or because of vertical linkages among firms. We examine a setup that combines those two approaches in conjunction with local congestion costs. We find that, as trade costs are lowered, the spatial concentration of total activity ("agglomeration") follows an inverse u-shaped evolution, while the degree of specialization of locations increases. The evolution of spatial configurations accommodated by this model is consistent with changes in sectorial employment patterns within US metropolitan areas over the 1850-1990 period.
    Keywords: agglomeration; specialization; congestion cost; input-output linkages
    JEL: F12 R12 R15
    Date: 2004–12
  23. By: Michael Storper; Anthony J. Venables
    Abstract: This paper argues that existing models of urban concentrations are incomplete unless grounded in the mostfundamental aspect of proximity; face-to-face contact. Face-to-face contact has four main features; it is anefficient communication technology; it can help solve incentive problems; it can facilitate socialization andlearning; and it provides psychological motivation. We discuss each of these features in turn, and developformal economic models of two of them. Face-to-face is particularly important in environments whereinformation is imperfect, rapidly changing, and not easily codified, key features of many creative activities.
    Keywords: Agglomeration, clustering, urban economics, face-to-face
    JEL: R1
    Date: 2003–12
  24. By: Samuel A. Baker (Department of Economics, College of William and Mary)
    Abstract: This paper examines the effects of political parties, executive power and efficiency on federal structure, proposing and testing a model of federalism in which different levels of veto power can lead to varying degrees of centralization in the provision of central and local governmental services when executive and legislative branches have disparate preferences over which level should provide services. Results for the US (1982-1992) find state and local spending centralizes with increased veto power because, absent offsetting political party advocacy for decentralization, central government spending interests dominate local government spending interests.
    Keywords: Federalism, Centralization, Political parties, Executive power, Veto
    JEL: H1
    Date: 2004–11–15
  25. By: Gem Argwings-Kodhek; T.S. Jayne
  26. By: Antonio Merlo (Department of Economics, University of Pennsylvania); François Ortalo-Magné (School of Business, University of Wisconsin-Madison)
    Abstract: This paper presents a new data set of individual residential property transactions in England. The main novelty of the data is the record of all listing price changes and all offers made between initial listing and sale agreement. We establish a number of stylized facts pertaining to the sequence of events that occur within individual property transaction histories. We assess the limitations of existing theories in explaining the data and discuss alternative theoretical frameworks
    JEL: D4 R0 L0
    Date: 2002–02–01
  27. By: F. Gerard Adams (Northeastern University); Byron Gangnes (University of Hawaii at Manoa); Yochanan Shachmurove (The City College of The City University of New York and the University of Pennsylvania)
    Abstract: This paper explores several theories regarding how China has become highly successful in capturing world export markets. The paper concludes that increased competitiveness is dependant on, but not limited to several factors discussed in detail including, exchange rate undervaluation, low wage rates and excess labor resources. Direct foreign investment which enabled China to produce products that meet world market specifications, brought new technology and foreign management, played a key factor. Reasons for China’s advantage over other East Asian countries are explored. The merits and methods of various measures of China’s competitiveness and comparative competitiveness are also discussed.
    Keywords: China exports, comparative advantage, competitiveness, purchasing power parity, exchange rate, undervaluation, devaluation, international comparisons, foreign direct investment, technology
    JEL: F0 F1 P0 R1
    Date: 2004–12–03
  28. By: De Borger Bruno; Van Dender Katrien
    Abstract: We consider a model of urban transport with two trip purposes, commuting (assumed perfectly complementary to labour supply) and non-commuting, to analyse the effects of transport tax reform on the value of time and marginal external congestion costs. Higher commuting taxes plausibly reduce time values, but higher non-commuting transport prices will typically raise the value of time. The intuition for this latter finding is that the reduction in congestion that follows from the tax increase itself raises net wages per hour of work (inclusive of commuting time). Empirical illustrations with Belgian data show a potentially large effect of transport tax reform on time values. In quite a few of the tax reforms studied traffic levels are reduced, but the increase in time values implies that marginal external congestion costs actually increase.
    Date: 2003–03
  29. By: Nikolaus Wolf
    Abstract: The paper explores the determinants of industry location across interwar Poland. After more than 120 years ofpolitical and economic separation, Poland was reunified at the end of 1918. In consequence, its industry facedmassive structural changes: the removal of internal tariff barriers and improved infrastructure strengthened thedomestic market, while foreign market relations were cut off. Similarly, the geographical dispersion of factorendowments was changed through internal migration and new institutional arrangements (education system,patent laws, etc.). How did these forces interact to determine the location of industry? Did a new interregionaldivision of labour emerge after unification? We survey the dynamics of industrial location between 1925 and1937 and estimate a specification that nests market potential and comparative advantage to quantify theirrespective impact over time. The results point to a role for both, comparative advantage and market potential,but there was a dominating and ever increasing impact of the availability of skilled labour.
    Keywords: Industrial Location, Endowments, Market Potential, Interwar Poland
    JEL: F10 F11 F12 F14 F15 N74 R3
    Date: 2004–01
  30. By: Steve Gibbons; Stephen Machin
    Abstract: In this paper we implement a powerful empirical approach than has not previously been appliedto rail transport evaluation to ascertain how much consumers value rail access. We study theeffects on house prices of a transport innovation that altered the distance to the nearest station forsome households, but left others unaffected. The transport innovation we study is theconstruction of new stations under improvements made to the London Underground andDocklands Light Railway in South East London in the late 1990s. Using the innovation toimplement a quasi-experimental approach studying house price changes in affected versusunaffected areas allows us to avoid the biases inherent in cross-sectional valuation work. Ourevidence on distance-station effects on prices suggests that rail access is significantly valued byhouseholds and that these valuations are sizable as compared to the valuations of other localamenities and services.
    Keywords: House Prices, Transport Innovations
    JEL: R4
    Date: 2004–01
  31. By: Victor Matheson (Department of Economics, College of the Holy Cross); Robert Baade (Department of Economics and Business, Lake Forest College)
    Abstract: Civic boosters generally have estimated the Super Bowl to have an impact of $300 to $400 million on a host city’s economy. The National Football League has used the promise of an economic windfall to convince skeptical cities that investments in new stadiums for their teams in exchange for the right to host the event makes economic sense. Evidence from host cities from 1970-2001 indicates the Super Bowl contributes approximately one-quarter of what the boosters have promised and that the game could not have contributed by any reasonable standard of statistical significance, more than $300 million to host economies.
    Keywords: football, impact analysis, Super Bowl, sports, mega-event
    JEL: L83 R53
  32. By: Victor Matheson (Department of Economics, College of the Holy Cross); Robert Baade (Department of Economics and Business, Lake Forest College)
    Abstract: Supporters of mega-sporting events such as the World Cup and Olympics claim that these events attract hoards of wealthy visitors and lead to lasting economic benefits for the host regions. Developing countries have become increasingly vocal in demanding a share of the economic benefits of these international games. The specialized infrastructure and operating expenses required to host these events, however, can be substantial. Independent researchers have found that boosters’ projections of the economic impact of sporting events exaggerate the true economic impact of these competitions, and these events are an even worse investment for developing countries than for industrialized nations.
    Keywords: development, football, impact analysis, World Bup, sports, mega-event
    JEL: L83 R53 O2
  33. By: Robert Baumann
    Abstract: Appalachians have lower wages, employment rates, and educational attainment than residents elsewhere in the country in each decennial Census since 1940, when schooling and wage information was first collected. Despite educational gains and large federal outlays since the late 1960s, the wage gap has slightly increased over this period from 19 log points in 1940 to 23 in 2000. This level of disadvantage is on par with other studied groups including women (Blau & Kahn, 1997), blacks (Juhn, Murphy, and Pierce, 1991), and Mexican-Americans (Trejo, 1997). Decompositions of the wage gap show faster educational rowth outside of the region increases the wage gap from 1940 to 1970. Increasing returns to both observable and unobservable skill, rising income inequality, and unfavorable demand shocks to low-skilled Appalachian labor increases the wage gap from 1980 to 2000.
    Keywords: Appalachia, poverty
    Date: 2003–11
  34. By: Peter R. Mueser (Department of Economics, University of Missouri-Columbia); Christopher T. King
    Abstract: Our study examines the dynamic structure of welfare participation and the labor market involvement of recipients starting in the early 1990s and extending through 1999 in the core counties containing six major urban areas: Atlanta, Baltimore, Chicago, Fort Lauderdale, Houston, and Kansas City. By focusing on six major cities, we can examine the extent to which differences in state and local policy, administrative directives, and local labor market conditions contribute to observed trends.
    JEL: I38 I31 H43
    Date: 2004–10–18
  35. By: Ting Gao (University of Missouri-Columbia); Yuwei Wang
    Abstract: In this paper we study the effects of openness on regional income and growth in China. We first construct exogenous components of openness to foreign direct investment (FDI) and trade based on geographic and cultural attributes of Chinese provinces, and then use them to obtain the instrumental variables estimates of the effects of FDI and trade on income and growth. We find positive effects of FDI on both income and growth, which are in most cases precisely estimated and economically large.
    JEL: F43 O18 O53 R11
    Date: 2004–12–27
  36. By: Anthony J. Venables
    Abstract: There is a substantial empirical literature quantifying the positive relationship between city size and productivity. The paper draws out the implications of this productivity relationship for evaluations of urban transport improvements. A theoretical model is developed and used to derive a wider cost-benefit measure that includes productivity effects. The order of magnitude of such effects is illustrated by calculations in a simple computable equilibrium model. It is argued tht productivity effects, particularly when combined with distortionary taxation, are quantitatively important, substantially increasing the gains that are created by urban transport improvements.
    Keywords: Agglomeration, productivity, urban transport
    JEL: R20 R42
    Date: 2004–09

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