nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2004‒12‒12
35 papers chosen by
Steve Ross
University of Connecticut

  1. RURAL-URBAN MIGRATION IN BOLIVIA: AN ESCAPE BOAT? By Maria Tannuri-Pianto; Donald Pianto; Omar Arias
  2. The geography of innovation: the effects of university research By Barrrio,T.; García-Quevedo,J.
  3. Were Spanish migrants attracted by industrial agglomerations? An analysis for the interwar years in the light of the new economic geography. By Pons,J.; Silvestre,J.; Tirado,D.; Paluzie,E.
  4. Why Does Educational Attainment Differ Across U.S. States? By Lutz Hendricks
  5. Political Economy of Commuting Subsidies By Rainald Borck; Matthias Wrede
  6. Identification of Equilibrium Models of Local Jurisdictions By Dennis Epple; Holger Sieg
  8. Estimating the Effects of Private School Vouchers in Multi-District Economies By Maria Ferreyra
  9. The impact of social networks on consumer's value attitude systems and store loyalty By Hoffmann, A.O.I.; Teerling, M.L.
  10. Changes in the financial management of housing corporations in the Netherlands : case research in two housing corporations By Bogt, H.J. ter
  11. Spatial distribution of investment in Russia: the effect of agglomeration By Valentina Lapo
  12. Informal Insurance in Social Networks By Francis Bloch (GREQAM and Universite de la Mediterranee), Garance Genicot (Georgetown University, and Debraj Ray (New York University and Instituto de Analisis Economico (CSIC))
  13. Is there a "Race-to-the-Bottom" in the Setting of Welfare Benefit Levels? Evidence from a Policy Intervention By Dahlberg, Matz; Edmark, Karin
  14. Spatial Inventor Networks As Studied by Patent Coinventorship By Ejermo, Olof; Karlsson, Charlie
  15. Towards a Dynamic Theory for the Spatial Knowledge Economy By Karlsson, Charlie; Johansson, Börje
  16. Fast Times at Ridgemont High? The Effect of Compulsory Schooling Laws on Teenage Births By Black, Sandra E.; Devereux, Paul J.; Salvanes, Kjell G.
  17. Asymmetric Capital Tax Competition with Profit Shifting By Stöwhase, Sven
  18. Using Hit Rate Tests to Test for Racial Bias in Law Enforcement: Vehicle Searches in Wichita By Nicola Persico; Petra Todd
  19. A Theory of Housing Collateral, Consumption Insurance and Risk Premia By Hanno Lustig; Stijn Van Nieuwerburgh
  20. School-to-Career and Post-Secondary Education: Evidence from Philadelphia Educational Longitudinal Study By Frank Furstenberg; David Neumark
  21. Sectoral and Geographical Specificities in the Spatial Structure of Economic Activities By Giulio Bottazzi, Giovanni Dosi, Giorgio Fagiolo, Angelo Secchi
  22. Equilibrium and the Core in Alonso’'s Discrete Population Model of Land Use By Marcus Berliant; Thijs ten Raa
  23. Effect of a School Finance Reform on Housing Stock and Residential Segregation: Evidence from Proposal A in Michigan By Joydeep Roy
  24. Urban Area Development in Stochastic Cellular Automata By Ivan Mulianta; Yun Hariadi
  25. Geographical Concentration and Economic Growth: Do Externalities Matter? By Mihai Nica
  26. On the Function of Two Variables of Urban Population Density By Ovidiu Racorean
  27. Fiscal Aspects of Metropolitan Governance By Richard M. Bird; Enid Slack
  28. Getting it Right: Financing Urban Development in China By Richard M. Bird
  29. Social Approval and Teenage Childbearing By Anandi Mani; Charles H. Mullin
  30. Exploring the Racial Gap in Infant Mortality Rates, 1920-1970 By William J. Collins; Melissa A. Thomasson
  31. Crime, Ethics and Occupational Choice: Endogenous Sorting in a Closed Model By John P. Conley; Ping Wang
  32. The Economic Aftermath of the 1960s Riots in American Cities: Evidence from Property Values By William J. Collins; Robert A. Margo
  33. The Political Economy of State Fair-Housing Laws Prior to 1968 By William J. Collins
  34. Horizontal mergers in the circular city : a note By Andreea Cosnita
  35. Do workers really benefit from their social networks ? By François Fontaine

  1. By: Maria Tannuri-Pianto; Donald Pianto; Omar Arias
    Abstract: This paper studies rural-urban migration in Bolivia. Domestic migration usually works as an equalization mechanism, in which regions with fewer economic opportunities send migrants to more dynamic regions. We model the migration decision and take into account the possibility of self-selection for computing the returns to migration. We present selectivity corrected quantile regression models for earnings of both migrants and non-migrants in urban and metropolitan areas. We find that migrants receive a premium at low and median quantiles of the urban/metro conditional earnings distribution. This premium is somewhat diminished by a negative selectivity correction for migrants with lower probabilities of migration.
    JEL: R23 C14 J24
    Date: 2004
  2. By: Barrrio,T.; García-Quevedo,J. (Universitat de Barcelona)
    Abstract: Applied studies on the relationship between geography and technological innovation for United States, Germany, France and Italy have shown the positive effects that academic research exerts on the innovate output of firms at spatial level. The purpose of this paper is to look for new evidence on the possible effects of the university research for the case of Spain. To do so, within the framework of a Griliches-Jaffe knowledge production function, and using panel data and count models, the relationship between innovate inputs and patents, in the case of the Spanish regions is explored.
    Keywords: Hysteresys, panel unit root tests, structural break
    JEL: O30 O18 R30 R58
    Date: 2004
  3. By: Pons,J.; Silvestre,J.; Tirado,D.; Paluzie,E. (Universitat de Barcelona)
    Abstract: In this paper we examine whether access to markets had a significant influence on migration choices of Spanish internal migrants in the inter-war years. We perform a structural contrast of a New Economic Geography model that focus on the forward linkage that links workers location choice with the geography of industrial production, one of the centripetal forces that drive agglomeration in the NEG models. The results highlight the presence of this forward linkage in the Spanish economy of the inter-war period. That is, we prove the existence of a direct relation between worker's localization decision and the market potential of the host regions. In addition, the direct estimation of the values associated with key parameters in the NEG model allow us to simulate the migratory flows derived from different scenarios of the relative size of regions and the distances between them. We show that in Spain the power of attraction of the agglomerations grew as they increased in size, but the high elasticity es timated for the migration costs reduce the intensity of internal migrations flow. This could help to explain the apparently low intensity of inernal migrations in Spainin Spain until its upsurge during thye 1920s. This also explains the geography of migrations in Spain during this perios, which hardly affected such as Andalusia, Estremadura and Castile-La Mancha) but had an intense effect on the provinces nearest to the principal centres of industrial development
    Keywords: Hysteresys, panel unit root tests, structural break
    JEL: N63 N64 N93 F14 F15
    Date: 2004
  4. By: Lutz Hendricks
    Abstract: The fraction of persons holding a college degree differs nearly two-fold across U.S. states. This paper documents data related to state educational attainment differences and explores possible explanations. It shows that highly educated states employ skillbiased technologies, specialize in skill-intensive industries, but do not pay lower skill premia than do less educated states. Moreover, measures of urbanization and population density are positively related to educational attainment. Theories based on agglomeration economies offer natural explanations for these observations.
    Keywords: education, agglomeration
    JEL: J24 R11
    Date: 2004
  5. By: Rainald Borck; Matthias Wrede
    Abstract: We study the political economy of commuting subsidies in a model of a mono-centric city with two income classes. Depending on housing demand and transport costs, either the rich or the poor live in the central city and the other group in the suburbs. Commuting subsidies increase the net income of those with long commutes or high transport costs. They also affect land rents and therefore the income of landowners. The paper studies how the locational pattern of the two income classes and the incidence of landownership affects the support for commuting subsidies.
    Keywords: commuting subsidies, voting, monocentric city
    JEL: R14 R48
    Date: 2004
  6. By: Dennis Epple; Holger Sieg
    Abstract: Research over the past several years has led to development of models characterizing equilibrium in a system of local jurisdictions. More recently, there have been a number of studies which have tried to estimate these models. The evidence suggests that simple parametric models can explain the observed sorting of individuals by income among local jurisdictions reasonably well. One drawback of the approach adopted in most empirical studies is that identification of important parameters of the model may be primarily due to functional form assumptions which are hard to evaluate. In this paper, we provide a discussion of identification and estimation of hierarchical equilibrium models in a semi-parametric framework. We show that a broad class of models is identified without imposing strong parametric restriction on the distribution of unobserved tastes for local public goods. We then extend the framework and consider a broad class of non-hierarchical model. Our results suggest that identification of non-hierarchical model may ultimately have to rely on stronger assumptions on the distribution of unobserved tastes for public goods than those used in hierarchical models.
    Date: 2002–11
  7. By: Constantino Cronemberger Mendes; Maria da Conceição Sampaio de Sousa
    Abstract: In this paper we estimated the demand for local public spending for the Brazilian municipalities within a median voter's framework. Results obtained are consistent with the theoretical background thus suggesting that this hypothesis might be useful to describe the demand for local public goods in Brazil. In particular, the use of quantile regression permitted to investigate the impacts of the conditioning variables on local public expenses across different expenditures classes thus allowing for heterogeneity across municipalities. Our results also suggest that the impact of the city size on the quality of club goods shows crowding effects as g is between zero and one. However, in the estimated models, marginal congestion slightly decreases with expenditure. This is a rather surprising result as one is tempted to conclude that the congestion effect should be higher on big cities. Yet, a more careful look shows the drawbacks of such interpretation. The indivisibilities that preclude the provision of certain services in small towns, concentrate their provision on larger cities. Hence, the higher expenditures of those big cities reflect not only a crowding cost but also the fact that these towns offer a wide range of services when compared to the small ones. So, in Brazil, contrary to the traditional results, the reduced congestion effect along the spending classes reflect the predominance of the scale elements measured by the population elasticities over the price effects.
    JEL: H70 C31 H72
    Date: 2004
  8. By: Maria Ferreyra
    Abstract: ---------- This paper estimates a general equilibrium model of school quality and household residential and school choice for economies with multiple public school districts and private (religious and non-sectarian) schools. The estimates are used to simulate two large-scale private school voucher programs in the Chicago metropolitan area: universal vouchers, and vouchers restricted to non-sectarian schools. In the simulations, both programs increase private school enrollment, and affect household residential choice. Under universal vouchers enrollment grows at all private schools, yet under non-sectarian vouchers private school enrollment expands less, and religious school enrollment declines with the voucher level. Fewer households benefit from non-sectarian vouchers. ------------
  9. By: Hoffmann, A.O.I.; Teerling, M.L. (Groningen University)
    Abstract: We are all influenced by the people whom surround us, i.e. our social network. So actually, to what extent do these social networks influence a consumers shopping behavior? Moreover are there differences in the strength of influence and to what level of consumers values does the influence of a social network stretch? We study the influence of two concepts of the social network, namely network expectations and the importance of so called hubs on the consumer value attitude system and store loyalty. The results show stronger global and domain specific values for hubs as well as a strong influence of the network expectations on the evaluation of store attributes as well as on store loyalty.
    Date: 2004
  10. By: Bogt, H.J. ter (Groningen University)
    Abstract: The Dutch housing sector saw some major changes since about 1990. After decades of strong central government regulation and support, the social rented sector and housing corporations had to become more autonomous and financially independent. Consequently, housing corporations had to implement several changes in their financial management and other management control aspects. On the basis of research questions which were based on contingency theory and sociological institutional theory, case research was conducted in two housing corporations, a relatively large and a relatively small one. The research shows that the large corporation implemented more radical changes in its financial management and operational management. Further, the results indicate that the two corporations implemented the changes because they were striving for more economic efficiency and continuity of their organization. However, as sufficient numerical data were lacking, it was not really possible to evaluate the development of economic efficiency. The research findings also suggest that, apart from economic rationality, a striving for socially rational behaviour also may have influenced the changes which were implemented in the two corporations. This means that contingency theory as well as institutional theory provided aspects that were relevant to explain the changes in financial management which were implemented by the two corporations.
    Date: 2004
  11. By: Valentina Lapo
    Abstract: The goal of this project is the explanation of spatial distribution of investment in Russia during the transition to a market economy. The influence of agglomeration and investor expectations on investment in the real sector of the economy are analyzed. A theoretical model is constructed, which describes an increase in investment concentration. An empirical test of hypothesis is conducted. The results provide useful recommendations for regional investment policies.
    Keywords: investment, agglomeration, expectation, concentration of production, regions
    JEL: R12
    Date: 2003–04–03
  12. By: Francis Bloch (GREQAM and Universite de la Mediterranee), Garance Genicot (Georgetown University, and Debraj Ray (New York University and Instituto de Analisis Economico (CSIC)) (Department of Economics, Georgetown University)
    Abstract: This paper studies informal insurance across networks of individuals. Two characteristics are fundamental to the model developed here: First, informal insurance is a bilateral activity, and rarely involves explicit arrangements across several people. Second, insurance is a social activity, and transfers are often based on norms. In the model studied here, only directly linked agents make transfers to each other, although they are aware of the (aggregate) transfers each makes to third parties. An insurance scheme for the network as a whole is an equilibrium of several interacting bilateral arrangements. This model serves as a starting point for investigating stable insurance networks, in which all agents actually have private incentives to abide by the ongoing insurance arrangement. The resulting analysis shows that network links have two distinct and possibly conflicting roles to play. First, they act as conduits for transfers, and in this way this make better insurance possible. Second, they act as conduits for information, and in this sense they affect the severity of punishments for noncompliance with the scheme. A principal task of this paper is to describe how these two forces interact, and in the process characterize stable networks. The concept of "sparse" networks, in which the removal of certain links increases the number of network components, is crucial in this characterization. As corollaries, we found that both "thickly connected" networks(such as the complete graph) and "thinly connected" networks (such as trees) are likely to be stable, whereas intermediate degrees of connectedness jeopardize stability. Finally, we study in more detail the notion of networks as conduits for transfers, by simply assuming a punishment structure (such as autarky) that is independent of the precise architecture of the tree. This allows us to isolate a bottleneck effect: the presence of certain key agents who act as bridges for several transfers. Bottlenecks are captured well in a feature of trees that we call decomposability, and we show that all decomposable networks have the same stability properties and that these are the least likely to be stable. Classification-JEL Codes: D85, D80, 012, Z13
    Keywords: social networks, informal insurance
  13. By: Dahlberg, Matz (Department of Economics); Edmark, Karin (Department of Economics)
    Abstract: In this paper we investigate whether local governments react on the welfare benefit levels in neighboring jurisdictions when setting their own benefit levels. We solve the simultaneity problem arising from the welfare game by utilizing a policy intervention; more specifically, we use a centrally geared exogenous placement of a highly welfare prone group (refugees) among Swedish municipalities as an instrument. The IV estimates indicate that there exists a "race-to-the-bottom" and that the effect is economically as well as statistically significant; if the neighboring municipalities decrease their welfare benefit level with 100 SEK, a municipality decreases its benefit level with approximately 59 SEK. This result is robust to several alternative model specifications.
    Keywords: Welfare benefit level; Strategic interactions; Race-to-the-bottom; Policy intervention
    JEL: C33 D60 H73
    Date: 2004–11–24
  14. By: Ejermo, Olof (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Karlsson, Charlie (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: We study the structure of the spatial inventor networks in Sweden by examining the residence of inventors and coinventors in Swedish patent applications to the European Patent Office. Several factors are found to influence the spatial affinity. We find that spatial affinity is strongly influenced by the general size of the nodes, as measured by population. In addition, affinities are strongly influenced by distance, but different technologies responded differently to distance. The most distance-sensitive technology, i.e. with the highest agglomeration of coinventors, was almost three times as sensitive to distance as the least sensitive. Interestingly, "Information technology" was the least distance-sensitive technology, which would be in line with predictions of "the death of distance". Higher affinity was also registered for many technologies when more university researchers were employed in one of the regions. Hence, a technology division is appropriate for understanding the span of innovation networks over regions, and how these could develop in response to policy initiatives.
    Keywords: Inventor networks; localization; patents; Sweden; affinity
    JEL: O31 O32 R12
    Date: 2004–11–29
  15. By: Karlsson, Charlie (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Johansson, Börje (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: In recent decades the world has witnessed the emergence of a global knowledge economy. For example, the evolution in recent decades of the developed economies has been accompanied by a regional shift in economic activity away from traditional industrial regions to new agglomerations of high technology, creating an explosion of entrepreneurial activity and new firm formation. For the OECD countries in particular, we can observe a transfer from an industrial economy to a knowledge economy. The supporting evidences are overwhelming and indicate that the trend is global. The emerging knowledge economy have attracted much interest among economist and generated many important contributions during the last two decades. However, the literature does not provide a comprehensive picture and we are indeed lacking a “general theory” of the knowledge economy. Various aspects of the emerging knowledge economy has been thoroughly analysed both theoretically and empirically but the overall synthesis is not yet present. Something to ask for would be a coherent theoretical framework that can explain how growth-induced investments in knowledge production stimulate localised, entrepreneur-driven innovations, which generate structural change and economic growth in an integrated system of functional regions. An interesting observation is that many of the necessary building blocks already seem to exist but that they are still waiting for someone to integrate them. The current state-of-the-art also includes inconsistent components. The purpose of this paper is to contribute to such an integration of the existing pieces of knowledge.
    Keywords: Knowledge; Economic Growth; New Economic Geography; Innovation Systems; Entrepreneurship
    JEL: M13 O31 O40 R11
    Date: 2004–12–02
  16. By: Black, Sandra E. (UCLA, NBER and IZA Bonn); Devereux, Paul J. (UCLA and IZA Bonn); Salvanes, Kjell G. (Norwegian School of Economics, Statistics Norway and IZA Bonn)
    Abstract: Research suggests that teenage childbearing adversely affects both the outcomes of the mothers as well as those of their children. We know that low-educated women are more likely to have a teenage birth, but does this imply that policies that increase educational attainment reduce early fertility? This paper investigates whether increasing mandatory educational attainment through compulsory schooling legislation encourages women to delay childbearing. We use variation induced by changes in compulsory schooling laws in both the United States and Norway to estimate the effect in two very different institutional environments. We find evidence that increased compulsory schooling does in fact reduce the incidence of teenage childbearing in both the United States and Norway, and these results are quite robust to various specification checks. Somewhat surprisingly, we also find that the magnitude of these effects is quite similar in the two countries. These results suggest that legislation aimed at improving educational outcomes may have spillover effects onto the fertility decisions of teenagers.
    Keywords: teenage childbearing, education, educational reform
    JEL: I21 J13 J24
    Date: 2004–11
  17. By: Stöwhase, Sven
    Abstract: This paper analyses capital tax competition between jurisdictions of different size when multinational firms can shift some fraction of their tax base between them. For the case of revenue maximizing governments, we show that introducing profit shifting will not generally increase downward pressure on tax rates. We find that profit shifting decreases the tax-base elasticity of the low tax jurisdiction while increasing the elasticity of the high tax jurisdiction. Therefore, by the direct (impact) effect, tax rates will converge as a result of additional profit shifting opportunities. In general equilibrium, however, tax rates may decrease or increase in both jurisdictions.
    JEL: H32 H26 H25 F23
    Date: 2004–12
  18. By: Nicola Persico; Petra Todd
    Abstract: This paper considers the use of outcomes-based tests for detecting racial bias in the context of police searches of motor vehicles. It shows that the test proposed in Knowles, Persico and Todd (2001) can also be applied in a more general environment where police officers are heterogenous in their tastes for discrimination and in their costs of search and motorists are heterogeneous in their benefits and costs from criminal behavior. We characterize the police and motorist decision problems in a game theoretic framework and establish properties of the equilibrium. We also extend the model to the case where drivers' characteristics are mutable in the sense that drivers can adapt some of their characteristics to reduce the probability of being monitored. After developing the theory that justifies the application of outcomes-based tests, we apply the tests to data on police searches of motor vehicles gathered by the Wichita Police deparment. The empirical findings are consistent with the notion that police in Wichita choose their search strategies to maximize successful searches, and not out of racial bias.
    JEL: J70 K42
    Date: 2004–12
  19. By: Hanno Lustig; Stijn Van Nieuwerburgh
    Abstract: In a model with housing collateral, a decrease in house prices reduces the collateral value of housing, increases household exposure to idiosyncratic risk, and increases the conditional market price of risk. This collateral mechanism can quantitatively replicate the conditional and the cross-sectional variation in risk premia on stocks for reasonable parameter values. The increase of the conditional equity premium and Sharpe ratio when collateral is scarce in the model matches the increase observed in US data. The model also generates a return spread of value firms over growth firms of the magnitude observed in the data, because the term structure of consumption strip risk premia is downward sloping.
    JEL: G0
    Date: 2004–12
  20. By: Frank Furstenberg; David Neumark
    Abstract: School-to-career (STC) programs provide high school students with career information and education to increase their educational attainment and enhance their long-term labor market success. These programs often target sub-groups that are less likely to attend four-year post-secondary institutions. We study a set of programs in Philadelphia that focus on boosting post-secondary enrollment and are less career-oriented than traditional STC programs. We find a strong association between participation in these programs and a wide array of academic outcomes. The findings are generally quite robust and are only slightly attenuated by the introduction of factors that might be indicative of selection. Finally, there is some evidence that the effects of these programs were greater for at-risk students, especially those whose mothers have at most a high school education.
    Date: 2004–11
  21. By: Giulio Bottazzi, Giovanni Dosi, Giorgio Fagiolo, Angelo Secchi
    Abstract: This work explores the spatial structure of location of production activities. We try to disentangle location- from sector-specific drivers in the dynamic process of spatial agglomeration. We argue that the former typically apply "horizontally" (i.e. across all industrial sectors), while the latter unfold in the form of non-decreasing dynamic returns to the current stock of installed business units. A stochastic model of location is developed and three different specifications are tested against Italian data on the location of manufacturing firms. Our results suggest that different locations exert different structural influences on the distribution of production activities. Moreover, a widespread horizontal power of "urbanization", which makes particular locations more attractive irrespectively of the sector, does emerge. However, after controlling for the latter, one is still left with sector-specific forms of dynamic increasing returns to agglomeration, which vary a lot across different manufacturing activities.
    Keywords: Industrial Location, Agglomeration, Markov Chains, Dynamic Increasing Returns.
  22. By: Marcus Berliant (Washington University in St. Louis); Thijs ten Raa (Tilburg University)
    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 confirm 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.
    Keywords: Publicly Provided Private Goods, Equilibrium, Core
    JEL: H42 R13 R52 D51 D61
    Date: 2004–11–22
  23. By: Joydeep Roy (Economic Policy Institute)
    Abstract: Local financing of public schools in the U.S. leads to a bundling of two distinct choices - residential choice and school choice - and increases the degree of socioeconomic segregation across school districts. A school finance reform can go a long way in weakening this link. In this paper I study the Michigan school finance reform of 1994 (Proposal A) which resulted in a comprehensive equalization of per pupil expenditures. Using panel data on Michigan K-12 districts and data from the decennial censuses I investigate whether the reform had any significant effects on spatial segregation. I find that Proposal A has been responsible for increases in housing stock and property values in the lowest spending school districts, and for improvements in several socioeconomic indicators, implying a decline is neighborhood sorting. However, there is continued high demand for residence in the highest spending communities, which points to the importance of neighborhood peer effects (‘local’ social capital).
    Keywords: School finance reform, spatial segregation, Tiebout sorting, peer effects.
    JEL: I2 R2
    Date: 2004–12–05
  24. By: Ivan Mulianta (Bandung Fe Institute); Yun Hariadi (Bandung Fe Institute)
    Abstract: Urban is still an interesting topic to discuss whether in government or public studies. As economy grows in cities, many people are attracted to come to cities from villages to try their luck. In this paper, we investigated urban area development using von Thunen’s economic location theory. By using stochastic Cellular Automata which views land location as agents that will change their states in agriculture, industry, and service series, here we show how the urban areas dominated by economy, industry, and service activities develop to their surroundings and form areas with typical activities with urban area. Even for the farther agriculture area from urban center, von Thunen’s theory is still valid.
    Keywords: von Thunen’s Theory, urban, Stochastic Cellular Automata, Markov matrices
    JEL: R
    Date: 2004–12–06
  25. By: Mihai Nica (Jackson State University)
    Abstract: Regardless of the reasons leading to its formation, it is widely accepted that geographical concentration of economic activity triggers increases in productivity. However, there are almost no studies that analyze the relationship between geographical concentration and economic growth. Moreover, when looking at the relationship between geographical concentration and productivity, past research almost unanimously modeled the underlying externality based on a scale measure (size) or an index. Starting from the assumption that the influence of geographical concentration on growth can be best modeled taking in consideration an intensive measure, such as population density, as an indicator of externalities, this study uses a growth accounting framework to assess the effect of geographical concentration on economic growth. It finds population density to be a good candidate for evaluating the externality influence, since a significant portion of the variation in economic growth over U.S. counties and BEA regions is explained by differences in population density.
    Keywords: Economic growth, Externalities, Geographical concentration, Spatial models
    JEL: R
    Date: 2004–12–06
  26. By: Ovidiu Racorean (Graduate Academy of Economic Studies, Bucharest, Romania)
    Abstract: This paper is a pure theoretical attempt to explain tendencies revealed in the last decade urban researches, such as decentralization of population toward the cities suburbs, formation of polycentric cities, by a process of alteration of city traditional monocentricity, in time, due to the growth of population. It is shown that the process of alteration of monocentricity is governed by a function of two variables of urban population density. The function is developed following the observation that urban population density is dependent, in the same time, both on distance-falling with the distance from the city center- and on time-growing with the increase of population size in cities area. The city model based on the function of two variables also predicts other interesting urban phenomena, such as cities ‘’collision’’.
    Keywords: urban population density, population growth, monocentric city model,polycentricity, decentralization of population.
    JEL: R
    Date: 2004–12–08
  27. By: Richard M. Bird (International Tax Program, Rotman School of Management, University of Toronto); Enid Slack (Enid Slack Consulting Inc.)
    Abstract: The aim of this paper is to review from a fiscal perspective the different models of governing structure found in metropolitan areas around the world. The fiscal perspective is important. While there is considerable dispute in the literature (e.g. Klink, 2002; Divay and Wolfe, 2002; Lefevre, 2003) as to exactly how, and how much, the design of governing institutions matters in affecting outcomes, it is indisputable that money matters: who has it, where does it come from, and under what conditions it can be spent and by whom. How public expenditures are financed directly affects the feasibility of any developmental proposal or service provision goal and is thus always a key issue in any city or metropolitan area strategy (World Bank, 2002). In particular, experience suggests strongly that the ability to “self-finance”--that is, to be free to at least some extent from the whims and wishes of others -- is a critical factor in determining which metropolitan institutions live and thrive and which fade away or die in bickering between contending financial supporters. We set out the key parameters of four models of government structure used around the world (one-tier, two-tier, voluntary cooperation, and special districts). We evaluate how these different models work in practice, drawing on real-world examples to illustrate the argument. We consider how well each model achieves coordination of service delivery over the entire metropolitan area, the extent to which they allow for the equitable sharing of costs of services throughout the metropolitan area, and their ability to reduce negative or positive spillovers of service delivery across local boundaries. We examine some aspects of local government expenditures and also look at main sources of revenue, evaluating the advantages and disadvantages of different revenue-raising tools for different governing structures. Finally, we summarize our findings on the fiscal aspects of governance for metropolitan regions around the world and made a few suggestions with respect to possible future fiscal developments in Latin American metropolitan regions.
    Keywords: metropolitan, agglomeration economies, knowledge-based economy, innovation, local, urban, government, government structure, Latin America
    Date: 2004–01
  28. By: Richard M. Bird (International Tax Program, Rotman School of Management, University of Toronto)
    Abstract: This paper is a brief review of some issues in urban finance facing China’s larger cities. It argues that at present many key aspects of the ways in which local and metropolitan governments finance infrastructure and services are financed in China seem to be both too obscure for proper accountability and too perverse for efficient use of scarce urban land and capital. Given the importance of urban areas for sustained national development, it is important to get urban finance “right” in the sense of providing the right signals to both public and private actors in urban development. Some suggestions are made on how this might perhaps be done by better designed user charges, property taxes, and other instruments.
    Keywords: China, urban finance, user charges, local taxes, infrastructure finance, public-private partnerships
    Date: 2004–08
  29. By: Anandi Mani (Department of Economics, Vanderbilt University); Charles H. Mullin (Department of Economics, Vanderbilt University)
    Abstract: We examine the phenomenon of "pockets of teenage illegitimacy" in a model of social approval, where attitudes to such illegitimacy are endogenously determined at a local community level. Both a woman's actual well-being and her community's perception of that well-being in each potential state - staying in school and early childbearing - impact her decisions. In particular, since individuals can better appreciate the successes and failures of those making similar choices as themselves, the accuracy of a community's perception of a woman's well-being increases in the fraction of her community who chose her state. With positive correlation in potential well-being across the two states, these imprecise community perceptions can lead to multiple steady states: Pockets of high/low illegitimacy emerge even though individuals do not, per se, derive utility from conformity. These pockets could be triggered off by public policy measures (such as AFDC), but also by exogenous "shocks" such as the urban middle class flight from the inner city - as suggested by Wilson (1987). A novel prediction of the model is that the lower the variability in potential well-being in the childbearing state, the more easily a community can become trapped in the high-illegitimacy steady state. So, programs such as EITC, which increase the variability in well-being among single mothers, may be more effective in reducing teenage illegitimacy, than traditional approaches, such as AFDC, which reduce this variability. Finally, these high-illegitimacy pockets may be more responsive to non-pecuniary measures such as integrated housing projects and mentors, which increase the diversity of a teenager's circle of social interaction, than individual financial incentives.
    Keywords: Illegitimacy; Welfare; Education; Social Approval
    JEL: I3
    Date: 2001–02
  30. By: William J. Collins (Department of Economics, Vanderbilt University, NBER); Melissa A. Thomasson (NBER)
    Abstract: This paper examines the racial gap in infant mortality rates from 1920 to 1970. Using state-level panel data with information on income, urbanization, women's education, and physicians per capita, we can account for a large portion of the racial gap in infant mortality rates between 1920 and 1945, but a smaller portion thereafter. We then re-examine the post-war period in light of trends in birth weight, maternal characteristics, smoking, air pollution, breast-feeding, insurance, and hospital births.
    Keywords: infant mortality, health, race
    JEL: I12 J15 N32
    Date: 2002–02
  31. By: John P. Conley (Department of Economics, Vanderbilt University); Ping Wang (Vanderbilt University and NBER)
    Abstract: We consider a simple model in which agents are endowed with heterogeneous abilities and differing degrees of honesty. Agents choose either to become criminals or invest in education and become workers instead. The model is closed in that all criminal proceeds are stolen from agents working in the formal sector and that expenditures on both deterrence and punishment of criminals are paid for through taxes levied on workers. Thus, although we assume that there no direct interactive effects among criminals, criminals crowd each other in two ways: positively in that enforcement and punishment resources become more widely diffused as more agents commit crimes, and negatively in that the presence of more criminals implies that there is less loot to be divided over a larger number of thieves. We establish the possibility of multiple equilibria and characterize the equilibrium properties. We then evaluate the effectiveness of deterrence policies under a balanced government budget.
    Keywords: Criminal Behavior, Educational Choice, Punishment
    JEL: I2 J62 K42
    Date: 2004–01
  32. By: William J. Collins (Department of Economics, Vanderbilt University, NBER); Robert A. Margo (Department of Economics, Vanderbilt University, NBER)
    Abstract: In the 1960s numerous cities in the United States experienced violent, race-related civil disturbances. Although social scientists have long studied the causes of the riots, the consequences have received much less attention. This paper examines census data from 1950 to 1980 to measure the riots' impact on the value of central-city residential property, and especially on black-owned property. Both ordinary least squares and two-stage least squares estimates indicate that the riots depressed the median value of black-owned property between 1960 and 1970, with little or no rebound in the 1970s. Analysis of household-level data suggests that the racial gap in the value of property widened in riot-afflicted cities during the 1970s.
    Keywords: Civil disturbance, Watts, Detroit, Newark
    JEL: R0 N92 J15
    Date: 2004–05
  33. By: William J. Collins (Department of Economics, Vanderbilt University; NBER; Model-Okun Fellow of Brookings Institution)
    Abstract: The confluence of the Great Migration and the Civil Rights Movement propelled the drive for "fair-housing" legislation which attempted to curb overt discrimination in housing markets. This drive culminated in the passage of the federal Civil Rights Act of 1968. By that time, 57 percent of the U.S. population and 41 percent of the African-American population already resided in states with a fair-housing law. Despite laying the political and administrative groundwork for the federal Fair Housing Act of 1968, the origins and diffusion of these state laws have not received much attention from scholars, let alone been subject to statistical efforts to disentangle multiple influences. This paper uses hazard models to analyze the diffusion of fair-housing legislation to shed new light on the combination of economic and political forces that facilitated the laws' adoption. Ceteris paribus, outside the South, states with larger union memberships, more Jewish residents, and more NAACP members passed fair-housing laws sooner than others. The estimated effects are not undermined by including controls for a variety of competing factors and are supported by historical accounts of the legislative campaigns.
    Keywords: Discrimination, Segregation, Civil Rights
    JEL: R0
    Date: 2004–06
  34. By: Andreea Cosnita (EUREQua)
    Abstract: We investigate the profitability and locational effects of two-firm Cournot mergers in the circular city. As compared with the linear market, we find that mergers turn out to be unprofitable much earlier.
    Keywords: Horizontal merger, endogenous location, circular city
    JEL: D43 L13
    Date: 2004–02
  35. By: François Fontaine (EUREQua)
    Abstract: This paper provides a simple matching model in which unemployed workers and employers in large firms can be matched together through social networks or through more "formal" methods of search. We show that networks do not necessarily add new externalities and that some results previously obtained in the literature are questionable. Nevertheless, social networks can, in some case, substitute for labor market and this crowding-out effect may be socially costly. We show that an increase in the number of workers embedded in the social networks can increase the unemployment rate and decrease workers welfare. Since it is mostly the firms which benefit from larger social networks, transfers from the firms to the workers are necessary to make larger access to the social network efficient.
    Keywords: Insider trading, stock prices, correlated signals, Kyle model
    JEL: G14 D82
    Date: 2004–09

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