|
on Urban and Real Estate Economics |
| By: | Edward L. Glaeser |
| Abstract: | The economic approach to cities relies on a spatial equilibrium for workers, employers and builders. The worker's equilibrium implies that positive attributes in one location, like access to downtown or high wages, are offset by negative attributes, like high housing prices. The employer's equilibrium requires that high wages be offset by a high level of productivity, perhaps due to easy access to customers or suppliers. The search for the sources of productivity differences that can justify high wages is the basis for the study of agglomeration economies which has been a significant branch of urban economics in the past 20 years. The builder's equilibrium condition pushes us to understand the causes of supply differences across space that can explain why some places have abundant construction and low prices while others have little construction and high prices. Since the economic theory of cities emphasizes a search for exogenous causes of endogenous outcomes like local wages, housing prices and city growth, it is unsurprising that the economic empirics on cities have increasingly focused on the quest for exogenous sources of variation. The economic approach to urban policy emphasizes the need to focus on people, rather than places, as the ultimate objects of policy concern and the need for policy to anticipate the mobility of people and firms. |
| JEL: | R0 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13696&r=ure |
| By: | Mark Doms; Fred Furlong; John Krainer |
| Abstract: | We evaluate the importance of three different channels for explaining the recent performance of subprime mortgages. First, the riskiness of the subprime borrowing pool may have increased. Second, pockets of regional economic weakness may have helped push a larger proportion of subprime borrowers into delinquency. Third, for a variety of reasons, the recent history of local house price appreciation and the degree of house price deceleration may have affected delinquency rates on subprime mortgages. While we find a role for all three candidate explanations, patterns in recent house price appreciation are far and away the best single predictor of delinquency levels and changes in delinquencies. Importantly, after controlling for the current level of house price appreciation, measures of house price deceleration remain significant predictors of changes in subprime delinquencies. The results point to a possible role for changes in house price expectations for explaining changes in delinquencies. |
| Keywords: | Mortgage loans ; Housing - Prices |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:2007-33&r=ure |
| By: | Matthew S. Chambers; Carlos Garriga; Don Schlagenhauf |
| Abstract: | The last decade has brought about substantial mortgage innovation and increased refinancing. The objective of this paper is to understand the determinants and implications of mortgage choice in the context of a general equilibrium model with incomplete markets. The equilibrium characterization allows us to study the impact of mortgage financing decisions in the productive economy. We show the influence of different contract characteristics such as the down payment requirement, repayment structure, and the amortization schedule for mortgage choice. We find that loan products that allow for low or no down payment or an increasing repayment schedule increase the participation of young and lower-income households. We find evidence that the volume of housing transactions increases when the payment profile is increasing and households have little housing equity. In contrast, we show that loans that allow for a rapid accumulation of home equity can still have positive participation effects without increasing the volatility of the housing market. The model predicts that the expansion of mortgage contracts and refinancing improves risk sharing opportunities for homeowners, but the magnitude varies with each contract. |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedawp:2007-25&r=ure |
| By: | Edward L. Glaeser; Joseph Gyourko |
| Abstract: | Urban economists understand housing prices with a spatial equilibrium approach that assumes people must be indifferent across locations. Since the spatial no arbitrage condition is inherently imprecise, other economists have turned to different no arbitrage conditions, such as the prediction that individuals must be indifferent between owning and renting. This paper argues the predictions from these non-spatial, financial no arbitrage conditions are also quite imprecise. Owned homes are extremely different from rental units and owners are quite different from renters. The unobserved costs of home owning such as maintenance are also quite large. Furthermore, risk aversion and the high volatility of housing pries compromise short-term attempts to arbitrage by delaying home buying. We conclude that housing cannot be understood with a narrowly financial approach that ignores space any more than it can be understood with a narrowly spatial approach that ignores asset markets. |
| JEL: | R21 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13704&r=ure |
| By: | Arnaud Simon (DRM - Dauphine Recherches en Management - CNRS : UMR7088 - Université Paris Dauphine - Paris IX) |
| Abstract: | This study examines the impact of real estate brokers on the price of residential properties sold in 2005 in twelve French cities. The results indicate that brokers increase the prices of properties they sell even though they appear to have heterogeneous behaviours across cities. The impact of brokers also varies by property size and age of clients. One and two room apartments have higher selling prices when sold through brokers. Buyers in their thirties and forties who seek the assistance of brokers pay more for their homes whereas older sellers obtain higher prices from broker intermediation. |
| Keywords: | residential real estate market, broker intermediation, brokers’ effect on price |
| Date: | 2007–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00197852_v1&r=ure |
| By: | Mathema, Ashna S.; Buckley, Robert M. |
| Abstract: | A recent study of house price behavior in U.S. cities by Gyourko, Mayer, and Sinai (2006) raises questions about so-called superstar cities in which housing is so inelastically supplied that it becomes unaffordable, as higher-income families outbid residents. We consider the case of Accra, Ghana, in this light, estimating the elasticity of housing supply and discussing the implications for growth and income distribution. There is not a great deal of data available to examine trends in Accra, so our method is indirect. First, we use a variant of the traditional monocentric city model to calculate the elasticity of Accra ' s housing supply relative to those of other similarly-sized African cities. This suggests that housing supply responsiveness is much higher elsewhere. This muted supply responsiveness is consistent with the observed higher housing prices. Second, we estimate a number of traditional housing demand equations and reduced form equations. Placing a number of restrictions on the equations allows us to infer Accra ' s housing supply elasticity. Taken together, our approaches suggest that lower-income families in Accra have such poor housing conditions because the market is extremely unresponsive to demand. Although the outcomes we have traced-high housing prices and low quality-are not unusual relative to the other developed country superstar cities, they are extreme. The welfare costs are considerable, so much so that in addition to direct housing market effects, these policies also appear to have potentially significant implications for the achievement of more equitable growth. |
| Keywords: | Economic Theory & Research,Housing & Human Habitats,Banks & Banking Reform,,Public Sector Management and Reform |
| Date: | 2007–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4453&r=ure |
| By: | Todd Sinai; Nicholas S. Souleles |
| Abstract: | This paper documents the trends in the life-cycle profiles of net worth and housing equity between 1983 and 2004. The net worth of older households significantly increased during the housing boom of recent years. However, net worth grew by more than housing equity, in part because other assets also appreciated at the same time. Moreover, the younger elderly offset rising house prices by increasing their housing debt, and used some of the proceeds to invest in other assets. We also consider how much of their housing equity older households can actually tap, using reverse mortgages. This fraction is lower at younger ages, such that young retirees can consume less than half of their housing equity. These results imply that 'consumable' net worth is smaller than standard calculations of net worth. |
| JEL: | E21 G11 G21 J14 R21 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13693&r=ure |
| By: | Kristopher Gerardi; Adam Hale Shapiro; Paul S. Willen |
| Abstract: | This paper provides the first rigorous assessment of the homeownership experiences of subprime borrowers. We consider homeowners who used subprime mortgages to buy their homes, and estimate how often these borrowers end up in foreclosure. In order to evaluate these issues, we analyze homeownership experiences in Massachusetts over the 1989–2007 period using a competing risks, proportional hazard framework. We present two main findings. First, homeownerships that begin with a subprime purchase mortgage end up in foreclosure almost 20 percent of the time, or more than 6 times as often as experiences that begin with prime purchase mortgages. Second, house price appreciation plays a dominant role in generating foreclosures. In fact, we attribute most of the dramatic rise in Massachusetts foreclosures during 2006 and 2007 to the decline in house prices that began in the summer of 2005. |
| Keywords: | Mortgage loans - Massachusetts ; Foreclosure - Massachusetts ; Home ownership - Massachusetts |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:07-15&r=ure |
| By: | Matthew Chambers; Carlos Garriga; Don Schlagenhauf |
| Abstract: | This paper analyzes the connection between the asymmetric tax treatment of homeowners and landlords and the progressivity of income taxation using a quantitative overlapping generations general equilibrium model with housing and rental markets. Our model emphasizes the determinants of tenure choice (own vs. rent) and the household decision to supply housing services to the rental market. This formulation breaks the link between the rental price and the equilibrium interest rate and, hence, the aggregate supply of rental property responds differently to the direction of rental price changes, marginal tax rate changes, and maintenance cost changes. We show that the model replicates the key factors and the distributional patterns of ownership, house size, and landlords. The degree of progressivity in the income tax code has important implications for housing tenure and housing consumption. We find a movement toward a less progressive income tax code can generate sizeable increases in homeownership and welfare that result from the equilibrium effects and a portfolio reallocation mechanism absent in economies with a single asset (i.e. Conesa and Krueger (2006)). An examination of the removal of existing asymmetries in the tax code are found to have effects on housing that differ from those reported in the literature. We show that housing policy can increase the ownership rate of a particular segment of the population, but generate nontrivial distributional costs. The welfare increases are no larger than those found when the progressivity of the tax code is reduced. |
| Keywords: | Home ownership ; Taxation |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedlwp:2007-053&r=ure |
| By: | Marcus Tamm |
| Abstract: | The German schooling system selects children into different secondary school tracks already at a very early stage in life. School track choice heavily influences choices and opportunities later in life. It has often been observed that secondary schooling achievements display a strong correlation with parental income. We use sibling fixed effects models and information on a natural experiment in order to analyze whether this correlation is due to a causal effect of income or due to unobservable factors that themselves might be correlated across generations. Our main findings suggest that income has no positive causal effect on school choice and that differences between high- and low-income households are driven by unobserved heterogeneity, e.g. differences in motivation or preferences. |
| Keywords: | Child poverty, educational attainment, secondary schools, sibling differences, natural experiment |
| JEL: | D31 I21 J13 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp41&r=ure |
| By: | Amelie Constant; Rowan Roberts; Klaus F. Zimmermann |
| Abstract: | Immigrants are much less likely to own their homes than natives, even after controlling for a broad range of life-cycle and socio-economic characteristics and housing market conditions. This paper extends the analysis of immigrant housing tenure choice by explicitly accounting for ethnic identity as a potential influence on the homeownership decision, using a two-dimensional model of ethnic identity that incorporates attachments to both origin and host cultures. The evidence suggests that immigrants with a stronger commitment to the host country are more likely to achieve homeownership for a given set of socioeconomic and demographic characteristics, regardless of their level of attachment to their home country. |
| Keywords: | Ethnicity, ethnic identity, immigration, immigrant integration, homeownership |
| JEL: | R21 F22 J15 Z10 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp57&r=ure |
| By: | Caroline Hussler (RECITS - Universite de Technologie de Belfort Montbeliard; BETA - Univeriste Louis Pasteur); Andre Lorentz (Max Planck Institute of Economics, Evolutionary Economics Group, Jena); Patrick Ronde (GRAICO - Universite de Haute Alsace) |
| Abstract: | This paper proposes a theoretical model of spatial duopoly, where the location, on the one hand, and the absorptive capacity of ï¬rms as function of their internal R+D investment, on the other hand, endogenously determine the maximum level of knowledge spillovers ï¬rms might absorb. Our goal is to test whether this new modelling of spillovers affects the traditional outcomes in terms of ï¬rms location choices . We solve a three-stage game, where ï¬rms choose their geographical location, prior to their level of internal R+D expenditures, and ï¬nally compete in prices. We found that, at the optimum, ï¬rms choose the same level of internal R+D and set the same price, independently of their location. Moreover, ï¬rms locate symmetrically and tends to agglomerate in the center of the market as the transportation costs increase, knowledge spillovers being in that case maximum. |
| Keywords: | Spatial Agglomeration, Endogenous Spillovers, Absorptive Capacity, Non-Cooperative Game |
| JEL: | O33 R12 L13 |
| Date: | 2007–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2007-102&r=ure |
| By: | Cecilia Elena Rouse; Jane Hannaway; Dan Goldhaber; David Figlio |
| Abstract: | While numerous recent authors have studied the effects of school accountability systems on student test performance and school "gaming" of accountability incentives, there has been little attention paid to substantive changes in instructional policies and practices resulting from school accountability. The lack of research is primarily due to the unavailability of appropriate data to carry out such an analysis. This paper brings to bear new evidence from a remarkable five-year survey conducted of a census of public schools in Florida, coupled with detailed administrative data on student performance. We show that schools facing accountability pressure changed their instructional practices in meaningful ways. In addition, we present medium-run evidence of the effects of school accountability on student test scores, and find that a significant portion of these test score gains can likely be attributed to the changes in school policies and practices that we uncover in our surveys. |
| JEL: | H75 I20 I21 I28 L38 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13681&r=ure |
| By: | Timothy J. Halliday (Department of Economics & John A. Burns School of Medicine, University of Hawaii at Manoa); Sally Kwak (Department of Economics, University of Hawaii at Manoa) |
| Abstract: | The potential influence of peers and social networks on individual outcomes is important to a variety of educational policy debates including school vouchers, special education, middle school grade configurations and tracking. Researchers usually address the identification problems associated with credibly estimating peer effects in these settings but often do not account for ad-hoc definitions of peer-groups. In this paper, we use extensive information on peer groups to demonstrate that accurate definitions of the peer network seriously impact estimation of peer effects. We estimate the effect of peers’ smoking, drinking, sexual behavior and educational achievement on a teen’s propensity to engage in like-minded behavior and address the major identification problems that plague estimation of these effects. |
| Keywords: | Peer Effects, Education, Adolescent Health |
| JEL: | I12 I20 |
| Date: | 2007–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:hai:wpaper:200730&r=ure |
| By: | Palanisamy , Saravanan; Ramamoorthy, Nagarajan |
| Abstract: | The current work aims at investigating the Housing Finance System in India and china with the follwoing major objectives. (i) To study the structural characteristics of housing finance system such as housing market and housing finance, borrowing contract types, lending and funding and regulations across the countries. (ii) To compare and contrast the evolution and recent trends in housing finance system in India and China. (iii) To assess the potential risk implications including the default, recovery, non-performing advances in this sector, the reasons and the recovery. |
| Keywords: | Housing Finance; India; China |
| JEL: | G21 |
| Date: | 2007–12–26 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:6454&r=ure |
| By: | Gilles Duranton; Matthew A. Turner |
| Abstract: | We estimate the effects of major roads and public transit on the growth of major cities in the US between 1980 and 2000. We find that a 10% increase in a city’s stock of roads causes about a 2% increase in its population and employment and a small decrease in its share of poor households over this 20 year period. We also find that a 10% increase in a city’s stock of large buses causes about a 0.8% population increase and a small increase in the share of poor households over this period. To estimate these effects we rely on an instrumental variables estimation which uses a 1947 plan of the interstate highway system and an 1898 map of railroads as instruments for 1980 roads. |
| Keywords: | urban growth, transportation, public transport, instrumental variables |
| JEL: | L91 N70 R11 R49 |
| Date: | 2007–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-305&r=ure |
| By: | Alejandra Mizala; Miguel Urquiola |
| Abstract: | The impact of competition on academic outcomes is likely to depend on whether parents are informed about schools' effectiveness or valued added (which may or may not be correlated with absolute measures of their quality), and on whether this information influences their school choices, thereby affecting schools' market outcomes. To explore these issues, this paper considers Chile's SNED program, which seeks to identify effective schools, selecting them from within "homogeneous groups" of arguably comparable institutions. Its results are widely disseminated, and the information it generates is quite different from that conveyed by a simple test-based ranking of schools (which in Chile, turns out to largely resemble a ranking based on socioeconomic status). We rely on a sharp regression discontinuity to estimate the effect that being identified as a SNED winner has on schools’ enrollment, tuition levels, and socioeconomic composition. Through five applications of the program, we find no consistent evidence that winning a SNED award affects these outcomes. This suggests that information on school effectiveness -- at least as it is calculated and delivered by the SNED -- might not much affect school markets. |
| JEL: | I2 |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13676&r=ure |
| By: | Anita I. Drever |
| Abstract: | In contrast to most research on the effects on residents of living in an ethnic neighborhood, this paper explores how living within an ethnic neighborhood affects members of the dominant ethnic group - in this case Germans - rather than the minorities that define it. The results indicate that Germans living within ethnic neighborhoods are less well off financially than their peers in other parts of the city, and are more likely to be living in large buildings in need of repair. The analysis did not however suggest that Germans living in ethnic neighborhoods have fewer social contacts, or that they are more likely to be unemployed. Indeed, Germans living within ethnic neighborhoods reported levels of satisfaction with their housing and standard of living equal to Germans elsewhere. These results would seem to paint a rosy picture of the lives of German residents of ethnic neighborhoods, were it not for a notable absence of school-aged German children within these spaces. |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp48&r=ure |
| By: | John B. Taylor |
| Abstract: | Since the mid-1980s, monetary policy has contributed to a great moderation of the housing cycle by responding more proactively to inflation and thereby reducing the boom bust cycle. However, during the period from 2002 to 2005, the short term interest rate path deviated significantly from what this two decade experience would suggest is appropriate. A counterfactual simulation with a simple model of the housing market shows that this deviation may have been a cause of the boom and bust in housing starts and inflation in the last two years. Moreover, a significant time series correlation between housing price inflation and delinquency rates suggests that the poor credit assessments on subprime mortgages may also have been caused by this deviation. |
| JEL: | E22 E43 E52 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13682&r=ure |
| By: | Ian Gazeley (University of Sussex); Andrew Newell (University of Sussex and IZA) |
| Abstract: | This paper presents an analysis of housing conditions amongst the British urban working class in 1904, using a re-discovered survey.1 We investigate overcrowding and we find major regional differences. Scottish households were more overcrowded despite being less poor. Investigating the causes of this overcrowding, we find little support for supply-side theories, and none for the idea that Scottish households experienced particularly great variations in income, causing them to commit to overly modest accommodation. However, the Scottish tenancy and local tax laws are probably important in explaining the overcrowding. We provide evidence that Scottish workers generally spent their rent reduction entirely on food, rather than saving. |
| Keywords: | poverty, rent, overcrowding, Scotland, 1904, Bowley |
| JEL: | N33 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3199&r=ure |
| By: | Geerte Cotteleer; Tracy Stobbe; G. Cornelis van Kooten |
| Abstract: | Since 1973, British Columbia created an Agricultural Land Reserve to protect farmland from development. In this study, we employ GIS-based hedonic pricing models of farmland values to examine factors that affect farmland prices. We take spatial lag and error dependence into explicit account. However, the use of spatial econometric techniques in hedonic pricing models is problematic because there is uncertainty with respect to the choice of the explanatory variables and the spatial weighting matrix. Bayesian model averaging techniques in combination with Markov Chain Monte Carlo Model Composition are used to allow for both types of model uncertainty. |
| Keywords: | Bayesian model averaging, Markov Chain Monte Carlo Model Composition, spatial econometrics, hedonic pricing, GIS, urban-rural fringe, farmland fragmentation |
| JEL: | R11 R15 C50 R14 |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:rep:wpaper:2007-07&r=ure |
| By: | Morris M. Kleiner; Richard M. Todd |
| Abstract: | As the role of mortgage brokers in mortgage origination grew from insignificant in the 1980s to dominant in recent years, questions have arisen about whether its services help or harm consumers. In response, states have increasingly regulated the business, largely by creating and tightening occupational licensing requirements for mortgage brokers. The question of whether increased occupational licensing of mortgage brokers improves consumer outcomes is theoretically ambiguous and has been little studied empirically. This study introduces a new database of mortgage broker licensing requirements and assesses the relationships between these requirements and outcomes in both the labor market for brokers and the consumer market for mortgages. We find that most aspects of mortgage broker licensing systems, such as mandatory professional education, do not have a significant and consistent statistical association with market outcomes. However, one component -- the requirement in many states that mortgage brokers maintain a surety bond or minimum net worth -- does have a significant and fairly consistent statistical relationship with both labor and consumer market outcomes. In particular, we find that tighter bonding/net worth requirements are associated with fewer brokers, fewer subprime mortgages, higher foreclosure rates, and a greater percentage of high-interest-rate mortgages. Although we do not provide a full causal interpretation of these results, we take seriously the possibility that restrictive bonding requirements for mortgage brokers have unintended negative consequences for many consumers. On balance, our results also seem to support theories of occupational licensing that stress the importance of pure entry and exit barriers over those that focus more on the human capital effects of licensing. |
| JEL: | H77 J18 J4 J44 J8 K2 K31 L22 L38 L51 L84 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13684&r=ure |
| By: | Joshua Drucker; Edward Feser |
| Abstract: | In a seminal article, Benjamin Chinitz (1961) focused attention on the effects that industry size, structure, and economic diversification have on firm performance and regional economies. He also raised a related but conceptually distinct question that has been overlooked since: how does the extent to which a regional industry is concentrated in a single or small number of firms impact the performance of other local firms within that industry? He suggested that such regional industrial dominance may impact input prices, limit capital accessibility, deter entrepreneurial activity, and reduce the regional availability of agglomeration economies such as specialized labor and supply pools In this paper, we use an establishment-level production function to quantify the links between industrial dominance, agglomeration economies, and firm performance. We consider two questions. First, do greater levels of regional industrial dominance lead to lower economic performance by small, dominated manufacturing plants? Second, are small plants in dominated regional industries more limited in capturing regional agglomeration benefits and therefore do they face rigidities in deploying production factors to maximum advantage? Our results suggest that regional industrial organization does influence productivity but that the effect tends to be a direct one, rather than an indirect effect via its influence on agglomeration economies. |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:07-31&r=ure |
| By: | Roberto Basile (ISAE - Institute for Studies and Economic Analyses); Marianna Mantuano (ISAE - Institute for Studies and Economic Analyses) |
| Abstract: | In this work we analyze the spatial distribution of manufacturing industries in Italy using data on the number of employees in the local units localized in the Local labour Systems, as revealed by the decennial censuses from 1971 to 2001. We use the Exploratory Spatial Data Analysis, which integrates synthetic measures of concentration and of spatial dependence with nonparametric techniques for the density estimation. With regards to the total manufacturing activity, the results suggest the existence of a hierarchical model, centered between Piedmont and Lombardy, in 1971, and a more complex polycentric model in 2001. At sectoral level, the findings also highlight a strong heterogeneity in the dynamics of geographic concentration. |
| Keywords: | Concentration, Italy, Exploratory Spatial Data Analysis. |
| JEL: | R12 C14 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:isa:wpaper:87&r=ure |
| By: | Sara C. Santos Cruz (CETE, Faculdade de Economia, Universidade do Porto); Aurora A.C. Teixeira (INESC Porto; CEMPRE, Faculdade de Economia, Universidade do Porto) |
| Abstract: | In the contemporary globalising knowledge-based economies, local clusters have become crucial elements of regional development, assuming a significant role in both academic and political fields. Although there is an intuitive awareness about the raising importance of the theoretical debate on clusters, there is a substantial lack of empirical support of its precise magnitude and evolution. Moreover, the majority of literature surveys on clusters are exclusively qualitative-based. Aiming at filling this gap, the main purpose of this paper is to provide a quantitative survey of the cluster literature, using bibliometric techniques based on articles. Based on a throughout analysis of all abstracts of articles on clusters published in journals indexed on the Econlit and EBSCO databases, covering the period 1962-2007, our research show that besides their importance in academic fields, the role of clusters has also been widely acknowledged in political spheres. In parallel with the increasing interest in the ‘local’, there has been, as well, an emergent body of literature on global networks and clusters. Moreover, on the basis of the recent boom on clusters literature stands the emergent themes of ‘local networks and social approaches’ and ‘knowledge-based theories’. Literature associated to ‘regional and national innovation systems’ and to ‘institutional approaches’ (local enrooted cultures, governance and customs) has been object of a particular dynamism since the 1990s. Despite the evidence of a clear positive correlation between journals ‘quality’ and formal related research, the evolution of the literature on clusters continues to be mostly appreciative led. |
| Keywords: | Clusters, Industrial Clusters, Industrial Location; Bibliometrics |
| JEL: | L22 R3 R10 R12 C89 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:257&r=ure |
| By: | Anne Leahy (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Alfons Palangkaraya (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Jongsay Yong (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | This paper investigates the geographic agglomeration of establishments in the Australian manufacturing industries during the period of 1994{1997. We find that although the agglomeration of Australian manufacturing has doubled during the period, it is still not as agglomerated as those in other developed economies such as the United States, the United Kingdom, France and Ireland. We also find that industries which receive higher assistance tend to be more agglomerated. However, there is no statistically significant evidence that the extent of the reduction in assistance due to trade liberalisation between 1994 and 1997 was associated with a further decrease in agglomeration. In terms of establishment dynamics, we ¯nd a significant increase in agglomeration but no evidence that establishment entry-exit patterns are correlated with agglomeration. |
| Keywords: | Agglomeration; Australian Manufacturing; Industry assistance; Trade liberalisation; Entry and exit. |
| JEL: | R11 R12 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2007n11&r=ure |
| By: | Christelle Viauroux |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:cin:ucecwp:2007-04&r=ure |
| By: | Guyonne Kalb (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Sholeh A. Maani (Department of Economics, The University of Auckland) |
| Abstract: | In this paper, we use a recent panel data set from New Zealand to examine the link between the academic performance and the decision by teenagers to drop out of school before exams at the end of year 10. These choices have significant lifetime economic impacts, since early school leaving in many cases closes pathways to further education. We address endogeneity and error correlation of potential performance in national examinations and school-leaving choices prior to exams. Birth month provides an instrument used in the equation for drop out, because those born in particular months can legally leave school before the exam takes place, whereas the other students cannot. The analyses incorporate the effect of academic ability (childhood IQ), parental education, family resources at different points in time while the child is growing up, and school and peer characteristics. The results show that those who drop out early are unlikely to have performed well in the exam. The predicted difference between those who drop out or continue, at least up to their exam, is almost completely explained by observed factors. Leaving out those variables which are often not available in other datasets (such as childhood IQ, childhood family resources and teenage peer effects), we find that the unobserved factors in academic performance and early school leaving are correlated. It is found that beyond childhood IQ and family resources, teenage peer and school factors have additional and significant associations with grade outcomes. This has important policy implications. |
| Date: | 2007–02 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2007n05&r=ure |
| By: | Florenz Plassmann; T. Nicolaus Tideman |
| Abstract: | When urban renewal projects require that smaller parcels be assembled into a single large one, owners who hold out for higher prices may either prevent or significantly delay socially efficient redevelopment. Local governments seeking private redevelopment currently have only the choice between either hoping that private bargaining will lead to efficient land assembly or taking the properties of these owners under eminent domain. We describe two mechanisms that solve the holdout problem and lead to efficiency in land assembly without resorting to governmental takings. |
| Keywords: | land assembly, takings, self-assessment |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:vpi:wpaper:e07-8&r=ure |
| By: | Edward L. Glaeser; Giacomo A.M. Ponzetto |
| Abstract: | Urban proximity can reduce the costs of shipping goods and speed the flow of ideas. Improvements in communication technology might erode these advantages and allow people and firms to decentralize. However, improvements in transportation and communication technology can also increase the returns to new ideas, by allowing those ideas to be used throughout the world. This paper presents a model that illustrates these two rival effects that technological progress can have on cities. We then present some evidence suggesting that the model can help us to understand why the past thirty-five years have been kind to idea-producing places, like New York and Boston, and devastating to goods-producing cities, like Cleveland and Detroit. |
| JEL: | R0 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13710&r=ure |
| By: | Oliver, Mikiko |
| Abstract: | Abstract: A descriptive analysis of the correlation of San Antonio single-family home prices and the related factors, is presented. The Least Squares results indicate that San Antonio home prices are primarily determined by US unemployment rate, 30-year mortgage rate, and CPI energy, controlling for other variables. CPI energy is an important determinant for San Antonio home prices. |
| Keywords: | Home Prices |
| JEL: | M21 |
| Date: | 2007–11–28 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:6441&r=ure |
| By: | Gilles Duranton |
| Abstract: | This paper reviews the evidence about the effects of urbanisation and cities on productivity and economic growth in developing countries using a consistent theoretical framework. Just like in developed economies, there is strong evidence that cities in developing countries bolster productive efficiency. Regarding whether cities promote self-sustained growth, the evidence is suggestive but ultimately inconclusive. These findings imply that the traditional agenda of aiming to raise within-city efficiency should be continued. Furthermore, reducing the obstacles to the reallocation of factors and activities, and more generally promoting the movement of human capital and goods across cities may have significant positive dynamic effects as well static ones. |
| Keywords: | Cities in developing countries, growth, urbanisation |
| JEL: | O18 R11 |
| Date: | 2007–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-306&r=ure |
| By: | Anna Steiger; Tessa Hebb; Lisa Hagerman |
| Abstract: | Community-based organizations promote economic development by assembling investments in affordable housing, mixed-use real estate, community facilities, and small business in specific geographies. A principal way that community-based organizations tap institutional investors for deals is by partnering with investment intermediaries who manage the risk of these transactions by pooling assets, spreading risk across investors, and pricing the transaction up to the associated risk. Such a partnership allows an investment intermediary, or what the industry calls an “investment vehicle,” to use its expertise to structure a deal that delivers high financial returns to the institutional investor while allowing the community-based organization, or “community partner,” to ensure that the investment provides a community benefit. ; In this paper, we argue that both sets of actors are necessary to achieve revitalized communities. Communities need to be able to tap into large-scale investment opportunities made possible by institutional investors while simultaneously ensuring that community residents benefit from such investment. We develop case studies of two investment vehicles and their community partners: the first investment vehicle we examine is the Urban Strategies America Fund, a for-profit urban development real estate fund in Boston; the second is Coastal Enterprises, Inc., of Portland, Maine, a not-for-profit community development corporation with for-profit investment subsidiaries. |
| Keywords: | Community development ; Community development - Maine ; Community development - Massachusetts |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbpc:07-5&r=ure |
| By: | Bygren, Magnus (Stockholm University Linnaeus Center for Integration Studies - SULCIS); Szulkin, Ryszard (Stockholm University Linnaeus Center for Integration Studies - SULCIS) |
| Abstract: | We ask whether growing up with persons of the same national background (which we refer to as coethnics), in the immediate neighbourhood, influences future educational careers of children of immigrants. We use administrative data to follow an entire cohort of immigrant children who graduated from Swedish compulsory schools in 1995. We have information on their parents and on their ethnic environment during the period they were 10 – 15 years old. The dependent variable studied is the highest completed education in years at age 24. We are able to account for unobserved heterogeneity with neighbourhood fixed effects and ethnic group fixed effects. We find that the effect of the quantitative side of the ethnic environment (the number of coethnics) on educational attainment is strongly conditioned by the qualitative side of this environment (the educational success of coethnics). The individual’s educational career is positively related to the number of young coethnics in the neighbourhood, but only if they can be characterized as being educationally successful. Growing up in a large ethnic community with average or poor educational success is harmful for the future educational success. The effect of the ethnic surrounding on the highest completed education is fully mediated by success in compulsory school. |
| Keywords: | Ethnic enclaves; education; neighborhood effects |
| JEL: | I20 I21 J15 |
| Date: | 2007–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sulcis:2007_008&r=ure |
| By: | Karine Pellier |
| Abstract: | In this paper, we investigate the impact of geographical spillovers in the patenting activity and convergence process for a sample of 131 European regions over the 1981-2001 period. Using spatial econometrics methods (Anselin, 1988, 2001), we detect spatial autocorrelation and heterogeneity in the regional distribution of patent applications to the European Patent Office. Then, we include successively these spatial effects in a convergence analysis. A first specifcation taking into account the spatial dependence reveals a global convergence process between European regions as also a positive effect of geographical spillovers on this convergence process. Secondly, the spatial heterogeneity is taking into account by a specification with two spatial regimes, a "Core-Periphery" type. Finally, ours results show that the global convergence process is hiding disparities and different convergence processes for the two regimes. Only regions that belong to the "Core" of the EU are converging. |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:lam:wpaper:07-14&r=ure |
| By: | Mika Widgrén; Markku Kotilainen; Nuutti Nikula; Ville Kaitila |
| Abstract: | ABSTRACT : The study examines the developments in production structures in Finnish regions and the differences in regional income levels and the causes that affect them in an integrating global economy as well as the challenges facing regional policies. The increasing openness of the world economy, the increasing competition it causes and its effect on Finland’s regions is the central task of this study. We combine the classical theory of international trade based on comparative advantage about the specialisation of countries with the approach of the new economic geography and agglomeration forces about the specialisation of regions inside countries. The study is a pioneer in Finland because similar analysis of regional production structures and specialisation has not been done before. We find that the so-called agglomeration forces drive the location of production in Finland. These regional agglomeration forces are the economic size of the region and closeness to markets (so-called market potential), distance between companies producing intermediate and final products, scale effects, and the educational level and R&D activities. Centralisation of production also requires that workforce is willing to relocate and that the productivity growth in core areas is faster than on average. Because labour mobility is such a central requirement for production agglomeration the study also examines migration within Finland in the past 50 years. For regional policies the conclusion of the study is that agglomeration forces should not be constrained if they lead to and are caused by faster productivity growth in core regions. In Finland there are significant differences in public sector services per capita in different regions so that regions with low wage and tax revenues have more public sector services in per capita terms than the core regions. This means that it is very hard to stop migration flows using the community tax equalisation scheme. |
| Keywords: | regional economy, agglomeration forces, comparative advantage, new economic geography |
| JEL: | R12 R15 R38 |
| Date: | 2007–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:rif:dpaper:1113&r=ure |
| By: | Giannotti, Claudio; Mattarocci, Gianluca |
| Abstract: | Real estate investment is different from financial investment and such difference can affect the results of traditional mean - variance models. The literature on property finance summarises the differences of expected return and expected risk among individual real estate investments into four risk profiles: tenant, endogenous, exogenous and financial risks. The aim of this paper is to examine how the differences reported in the literature can affect the composition of a real estate portfolio based on Markowitz optimisation standards. The results stemming from the use of a real estate database supplied by Fimit SGR (Capitalia banking group) showed that an ex-ante study of risk profiles can help to identify those investment opportunities which are more or less near to the efficient frontier, although there is no prevailing criterion to identify a portfolio able to maximise investment diversification benefits. |
| Keywords: | Markowitz; Real Estate Portfolio and Risk Diversification |
| JEL: | G11 L85 |
| Date: | 2007–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:6483&r=ure |
| By: | Todd C. Neumann; Price V. Fishback; Shawn Kantor |
| Abstract: | During the New Deal the Roosevelt Administration dramatically expanded relief spending to combat extraordinarily high rates of unemployment. We examine the dynamic relationships between relief spending and local private labor markets using a new panel data set of monthly relief, private employment and private earnings for major U.S. cities in the 1930s. Impulse response functions derived from a panel VAR model that controls for time and city fixed effects show that a work relief shock in period t-1 led to a decline in private employment and a rise in private monthly earnings. The finding offers evidence consistent with contemporary employers' complaints that work relief made it more difficult to hire, even though work relief officials followed their stated policies to avoid affecting private labor markets directly. Meanwhile, negative shocks to private employment led to increases in work relief, consistent with Roosevelt's stated goal of using relief to promote relief and recovery. |
| JEL: | N0 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13692&r=ure |
| By: | Galdini, Rossana |
| Abstract: | Urban tourism is in full expansion due to world-wide urbanisation and internationalisation of our societies. New economic impulse created by investments in urban regeneration, and improving the quality of life, produces different consequences. This paper tries to examines the benefits and costs which tourism has on host environments, economies and societies and analyses the strategic conditions which can assist cities to revitalise their territory, through a coherent tourism policy. An Italian case study, Genoa is used to illustrate some of these impact issues. Genoa, after a deep crisis, has regained a new identity and its role in the Italian economic and social system. The paper provides a critical approach of how places of cultural significance are transformed into places of consumption by investigating the relationship between culture as a resource for identity and culture as an economic resource. |
| Keywords: | urban tourism; regeneration; culture; environment; sustainability |
| JEL: | R0 L83 |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:6370&r=ure |
| By: | Cowan, Robin (UNU-MERIT); Zinovyeva, N. (BETA, Université Louis Pasteur) |
| Abstract: | This paper analyzes empirically the channels through which university research affects industry innovation. We examine how the opening of new science, medicine and engineering departments in Italy during 1985-2000 affected regional innovation systems. We find that creation of a new university department increased regional innovation activity 3-4 years later. On average, an opening of a new department in a region has led to a ten percent change in the number of patents filed by regional firms. Given that this effect occurs within the first half decade of the appearance of a new department, it cannot be ascribed to improvements in the quality and quantity of graduates. At the same time, traditional measures of academic research activity can explain only around 30 percent of this effect. |
| Keywords: | Innovation, Academic Research, R&D, Universities, University-Industry Linkages, Technology Transfer, Regional Innovation Systems. |
| JEL: | O31 O32 O33 I23 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2007037&r=ure |
| By: | Hiroko Uchimura; Johannes P. Jütting |
| Abstract: | This paper analyses the effect of fiscal decentralisation on health outcomes in China using a panel data set with nationwide county-level data. We find that counties in more fiscally decentralised provinces have lower infant mortality rates than counties where the provincial government remains the main spending authority, if certain conditions are met. Spending responsibilities at the local level need to be matched with county governments’ own fiscal capacity. For county governments that have only limited revenues, the ability to spend on local public goods such as health care depends crucially upon intergovernmental transfers. The findings of this paper, therefore, support the common assertion that fiscal decentralisation can lead to more efficient production of local public goods, while also highlighting the conditions required for this result to be obtained. <BR>Ce papier analyse l’effet de la décentralisation fiscale sur la santé en Chine, à partir d’une analyse de panel avec des données de district recueilli au niveau national. Les auteurs trouvent que, sous certaines conditions, les districts aux systèmes plus décentralisés ont des taux de mortalité infantiles moins élevés que ceux où le gouvernement provincial reste la principale autorité. Les responsabilités pour les dépenses au niveau local doivent toutefois être accompagnées de capacités fiscales adéquates. Pour les gouvernements de districts à bas revenus, la capacité à investir dans des biens publics comme les services de santé, dépend principalement des transferts intergouvernementaux. Les analyses confirment l’argument selon lequel la décentralisation fiscale peut mener à une plus grande efficacité des biens publics, en soulignant les conditions nécessaires pour atteindre ce résultat. |
| Keywords: | health, santé, fiscal decentralisation, décentralisation fiscale, China, Chine, Health-care finance, financement des services de santé |
| JEL: | H51 H72 H75 I18 |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaaa:264-en&r=ure |