nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2005‒03‒06
eight papers chosen by
Steve Ross
University of Connecticut

  1. Smart Café Cities: Testing Human Capital Externalities in the Boston Metropolitan Area By Shihe Fu
  2. Ethnic enclaves and welfare cultures - quasi-experimental evidence By Åslund, Olof; Fredriksson, Peter
  3. The Effect of Age at School Entry on Educational Attainment in Germany By Fertig, Michael; Kluve, Jochen
  4. "Risk, Transaction Costs, and Geographic Distribution of Share Tenancy: A Case of Pre-War Japan" By Yutaka Arimoto; Tetsuji Okazaki; Masaki Nakabayashi
  5. Other Things Being Equal: A Paired Testing Study of Discrimination in Mortgage Lending By Margery Austin Turner; Erin Godfrey; Stephen L. Ross; Robin R. Smith
  6. Occupation-Specific Human Capital and Local Labor Markets By Jeffrey A. Groen
  7. The Geography of Innovation Commercialization in the United States During the 1990s By Joshua L. Rosenbloom
  8. Efficiency and Consistency for Locating Multiple Public Facilities By Biung-Ghi Ju

  1. By: Shihe Fu (Boston College)
    Abstract: Existing studies have explored either only one or two of the mechanisms that human capital externalities percolate at only macrogeographic levels. This paper, by using the 1990 Massachusetts census data, tests four mechanisms at the microgeographic levels in the Boston metropolitan area labor market. We propose that individual workers can learn from their occupational and industrial peers in the same local labor market through four channels: depth of human capital stock, Marshallian labor market externalities, Jacobs labor market externalities, and thickness of the local labor market. We find that all types of human capital externalities are significant across census tracts and blocks. Marshallian labor market externalities and the effect of labor market thickness in terms of industry employment density are significant at the block level. The mechanisms of knowledge spillovers vary across industries and occupations. Different types of externalities attenuate at different speeds over geographic distances. The effect of labor market thickness -- in terms of industry employment density -- decays rapidly beyond 1.5 miles away from block centroid; the effect of human capital depth decays rapidly beyond three miles; while Jacobs externalities decay very slowly, indicating a certain degree of urbanization economies. We conclude that knowledge spillovers are very localized within microgeographic scope in cities that we call, "Smart Cafe Cities."
    Keywords: human capital, externalities, labor markets
    JEL: C21 R23 J24
    Date: 2005–02–07
  2. By: Åslund, Olof (IFAU - Institute for Labour Market Policy Evaluation); Fredriksson, Peter (IFAU - Institute for Labour Market Policy Evaluation)
    Abstract: We examine peer effects in welfare use among immigrants to Sweden by exploiting a governmental refugee placement policy. We distinguish between the quantity of contacts – the number of individuals of the same ethnicity – and the quality of contacts – welfare use among members of the ethnic group. OLS regressions suggest that both these factors are positively related to individual welfare use. Instrumental variables estimations yield the conclusion that only the quality of contacts matter. An increase of the fraction of the ethnic group on welfare by 10 percent raises the individual probability of welfare use by almost 7 percent.
    Keywords: Ethnic enclaves; welfare use; immigrants
    JEL: I38 J15 J18
    Date: 2005–02–07
  3. By: Fertig, Michael (RWI Essen and IZA Bonn); Kluve, Jochen (RWI Essen and IZA Bonn)
    Abstract: Determining the optimal age at which a child should enter school is a controversial topic in education policy. In particular, German policy makers, pedagogues, parents, and teachers have since long discussed whether the traditional, established age of school entry at 6 years remains appropriate. Policies of encouraging early school entry or increased consideration of a particular child's competency for school ("Schulfähigkeit") have been suggested. Using a dataset capturing children who entered school in the late 1960s through the late 1970s, a time when delaying enrolment was common, we investigate the effect of age at school entry on educational attainment for West and East Germany. Empirical results from linear probability models and matching suggest a qualitatively negative relation between the age at school entry and educational outcomes both in terms of schooling degree and probability of having to repeat a grade. These findings are likely driven by unobserved ability differences between early and late entrants. We therefore use a cut-off date rule and the corresponding age at school entry according to the regulation to instrument the actual age at school entry. The IV estimates suggest there is no effect of age at school entry on educational performance.
    Keywords: schooling, matching, instrumental variables
    JEL: I21 J13
    Date: 2005–03
  4. By: Yutaka Arimoto (Graduate School of Agricultural and Life Sciences, University of Tokyo); Tetsuji Okazaki (Faculty of Economics, University of Tokyo); Masaki Nakabayashi (Graduate School of Economics, Osaka University)
    Abstract: This paper investigates determinants of geographic distribution of share tenancy and analyzes its efficiency implications in pre-war Iwate prefecture, Japan. The distribution of share tenancy was attributable to risk represented by yield variability, which in turn was affected by seasonal winds called Yamase and topographic features. That risk raised transaction costs of adopting a fixed-rent tenancy associated with the common custom of rent reduction in Japan that mitigated the problem of risksharing. Estimation results suggest that risk, wealth, and strength of community ties were the main determinants of contract choice.
    Date: 2005–03
  5. By: Margery Austin Turner (Metropolitan Housing and Communities Policy Center, Urban Institute); Erin Godfrey (New York University); Stephen L. Ross (University of Connecticut); Robin R. Smith (Metropolitan Housing and Communities Policy Center, Urban Institute)
    Abstract: This paper analyzes data from a recently completed study of discrimination against African-American and Hispanic homebuyers when they visit mortgage lending institutions in two major metropolitan markets to make pre-application inquiries. It represents the first application of paired testing to rigorously measure discrimination in the mortgage lending process. The paired tests isolated significant levels of differential treatment on the basis of race and ethnicity in Chicago with African Americans and Hispanics receiving less information and assistance than comparable whites. Adverse treatment of African-Americans and Hispanics is also observed in Los Angeles for specific treatments, but the overall pattern of treatment observed did not differ statistically from equal treatment. Multivariate analyses for Chicago indicate that large lenders treat minorities more favorably than small lenders and that lenders with substantial numbers of applications from African-Americans treat African Americans more favorably than lenders with predominantly white application pools.
    JEL: G21 J15 L85 R30
    Date: 2005–02
  6. By: Jeffrey A. Groen (U.S. Bureau of Labor Statistics)
    Abstract: Most skills acquired through on-the-job training may be specific to an occupation and therefore transferable to some but not all firms. This paper explores the relationship between the size of the local market for an occupation-specific skill and job-training outcomes. The Stevens (1994) model of training predicts that as market size increases, job turnover increases and training becomes more general. I test these predictions using data on blue-collar workers and variation in market size across U.S. metropolitan areas. The empirical results support the theoretical predictions and the impacts are most relevant at low levels of market size.
    Keywords: on-the-job training, occupation, human capital, local labor markets, market size
    JEL: J24 J63 J61
    Date: 2005–02
  7. By: Joshua L. Rosenbloom (Department of Finance, The University of Kansas)
    Abstract: This paper analyzes the location and interrelationship of three measures of innovation commercialization across the 50 largest metropolitan areas in the United States and estimates a model of the factors explaining variations in the location of innovation commercialization. In general innovation commercialization tends to be highly geographically concentrated, suggesting the presence of substantial external economies in these functions. Beyond these scale effects, however, I find that the university science and engineering capacity and local patenting activity both help to account for intercity differences in the level of innovation commercialization activity.
    Date: 2005–01
  8. By: Biung-Ghi Ju (Department of Economics, The University of Kansas)
    Abstract: In the problem of locating multiple public facilities studied by Barbera and Bevia (2002), we offer simple necessary and sufficient conditions for effciency, decentralizability of efficient decisions in a game of community division and local public goods provision, and a constructive algorithm for efficient and consistent decisions.
    Keywords: Efficiency; Consistency; Self-selection consistency; No-envy; Local stability; Diversity; Strong Nash equilibrium; Community division; Location
    Date: 2005–02

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