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on Urban and Real Estate Economics |
| By: | Immergluck, Daniel (Georgia Institute of Technology); Carpenter, Ann (Federal Reserve Bank of Atlanta); Lueders, Abram (Federal Reserve Bank of Atlanta) |
| Abstract: | From the last quarter of 2012 to the last quarter of 2015, median rents rose 23.4 percent in the South, according to the Census Bureau. Accordingly, an increasing number of households in the South are cost-burdened, which is defined as a household spending more than 30 percent of its income on housing. A growing number of households spend over 50 percent of their income on rent, making them severely cost-burdened. The percentage of such severely cost-burdened households with incomes below $35,000 reached 80 percent in 2014 in eight central cities in the Southeast (Atlanta, Birmingham, Jacksonville, Memphis, Miami, Nashville, Orlando, and Tampa). Cost-burdened households have significant challenges, including forced trade-offs among housing, transportation, child care, health care, and other necessities.{{p}} The increase in cost-burdened households is due in part to the decrease in affordable rented units in urban areas. This paper examines the landscape of low-cost rented housing units in these eight southeastern cities. We find that low-cost rented units (defined as those with gross rents of less than $750 per month) decreased in all eight cities between the American Community Survey periods of 2006−10 and 2010−14. Based on these data, each of these eight cities is losing hundreds, and sometimes thousands, of low-cost rented units annually.{{p}} Housing trends affecting the rental housing market include the conversion of formerly owner-occupied homes into rental units, the aging and abandonment of low-cost rented units, and competition in the market with high-cost or luxury rented housing, including conversion of formerly low-cost units into more luxurious units, and the increased competition with luxury developers and therefore higher land prices. Based on our analysis, greater levels of loss of low-cost rented units are disproportionately concentrated in certain types of neighborhoods, including those with higher shares of young adults, a larger portion of newer housing units, and lower poverty rates. These factors are generally consistent with areas experiencing rising rents and the conversion of lower-cost units into higher-cost ones in areas perceived to be attractive to higher-end rental housing. |
| Keywords: | affordable housing; rented housing; cost-burdened households; housing policy |
| JEL: | H20 H70 R21 R31 |
| Date: | 2016–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedacd:2016-03&r=ure |
| By: | Michael Bailey; Ruiqing Cao; Theresa Kuchler; Johannes Stroebel |
| Abstract: | We document that the recent house price experiences within an individual’s social network affect her perceptions of the attractiveness of property investments, and through this channel have large effects on her housing market activity. Our data combine anonymized social network information from Facebook with housing transaction data and a survey. We first show that in the survey, individuals whose geographically-distant friends experienced larger recent house price increases consider local property a more attractive investment, with bigger effects for individuals who regularly discuss such investments with their friends. Based on these findings, we introduce a new methodology to document large effects of housing market expectations on individual housing investment decisions and aggregate housing market outcomes. Our approach exploits plausibly-exogenous variation in the recent house price experiences of individuals’ geographically-distant friends as shifters of those individuals’ local housing market expectations. Individuals whose friends experienced a 5 percentage points larger house price increase over the previous 24 months (i) are 3.1 percentage points more likely to transition from renting to owning over a two-year period, (ii) buy a 1.7 percent larger house, (iii) pay 3.3 percent more for a given house, and (iv) make a 7% larger downpayment. Similarly, when homeowners’ friends experience less positive house price changes, these homeowners are more likely to become renters, and more likely to sell their property at a lower price. We also find that when individuals observe a higher dispersion of house price experiences across their friends, this has a negative effect on their housing investments. Finally, we show that these individual-level responses aggregate up to affect county-level house prices and trading volume. Our findings suggest that the house price experiences of geographically-distant friends might provide a valid instrument for local house price growth. |
| JEL: | D12 D14 D84 G12 R21 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22258&r=ure |
| By: | Chatman , Daniel; Xu, Ruoying; Park , Janice; Le, Kim |
| Abstract: | Public transit investments are a large and growing share of all transportation investments in the state of California, and such critical investments should be evaluated partly on their economic benefits. Taking such benefits into account could alter investment, service, and service restructuring decisions taken by transit agencies in the state. The relationship of public transportation to economic productivity, and spatial patterns of industrial location, is understudied. This project investigated how changes in rail transit service in California metropolitan areas (Los Angeles, the San Francisco Bay Area, and San Diego) are associated with firm clustering by industry and with commercial property values. A mixed methods approach was used. One strand of the research involved first, describing location patterns by industry according to transit access, and second, quantitatively modeling the relationship between transit access and (a) employment densification by industry and (b) commercial property values, using instrumental variables techniques with dynamic panel modeling in order to better infer causal relationships. The second strand consisted of interviews and other qualitative research aimed at finding possible explanations for firm location and expansion, and firm productivity. The quantitative research found that rail development generally promotes employment agglomeration and increased land value, but the magnitude of such effects differs across regions. San Francisco County had the highest employment densification and land value associated with rail proximity, while the LA region also had a relatively strong relationship between rail access and both employment density and property value. Rail access in the southern part of the San Francisco Bay Area, where Silicon Valley is situated, had a small relationship with employment densification but a positive effect on land values. On the contrary, rail development in the San Diego region was positively associated with employment density, but negatively associated with land value appreciation. Our interviews were consistent with these quantitative findings, and suggested that the differences between regions are due to differences in historical land development and use patterns as well as urban land regulations. In the San Francisco Bay Area, developers and real estate brokers report that rail transit plays the greatest role in the City of San Francisco, with relatively weak importance in Silicon Valley due to higher parking provisions and employer-provided transportation amenities such as shuttles. In the Los Angeles metropolitan area, rail transit is most highly valued in the dense downtown Los Angeles area, and is perceived to be playing an increasingly important role across the region as in places where traffic congestion is high and increasing. |
| Keywords: | Engineering, public transportation, firm cluster, agglomeration, commercial property values, economic development |
| Date: | 2016–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsrrp:qt1z01h8ts&r=ure |
| By: | Sofia F. Franco; Jacob L. Macdonald |
| Abstract: | This paper examines the impact of historic amenities on residential housing prices in the city of Lisbon, Portugal. Our study is directed towards identifying the spatial variation of amenity values for churches, palaces, lithic (stone) architecture and other historic amenities via the housing market, making use of both global and local spatial hedonic models. Our empirical evidence reveals that different types of historic and landmark amenities provide different housing premiums. While having a local non-landmark church within 100 meters increases housing prices by approximately 4.2%, higher concentrations of non-landmark churches within 1000 meters yield negative effects in the order of 0.1% of prices with landmark churches having a greater negative impact around 3.4%. In contrast, higher concentration of both landmark and non-landmark lithic structures positively influence housing prices in the order of 2.9% and 0.7% respectively. Global estimates indicate a negative effect of protected zones, however this significance is lost when accounting for heterogeneity within these areas. We see that the designation of historic zones may counteract negative effects on property values of nearby neglected buildings in historic neighborhoods by setting additional regulations ensuring that dilapidated buildings do not damage the city’s beauty or erode its historic heritage. Further, our results from a geographically weighted regression specification indicate the presence of spatial non-stationarity in the effects of different historic amenities across the city of Lisbon with variation between historic and more modern areas. JEL codes: C21, P25 |
| Keywords: | Spatial hedonic models, Historic amenities |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:unl:unlfep:wp602&r=ure |
| By: | Nikulin, Alexander Mikhailovich (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Kopoteva, Inna (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Rizatdinov, R. F. (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Trotsuk, Irina Vladimirovna (Russian Presidential Academy of National Economy and Public Administration (RANEPA)) |
| Abstract: | In today's inter-disciplinary socio-spatial research, as well as in areas of regional policy related to sustainable development of rural areas and communities in their interaction with the cities gained a significant body of both Russian and foreign approaches requiring synthetic rethinking to generate new research study of modern software rural-urban continuum. One of the possible platforms for the creation and development of such programs could be the E.E. Leizerovich concept of russian neighborhoods. To prepare an analytical review of the major Russian and foreign typologies of rural areas and communities in connection with the current problems of the rural-urban development, we pose the question of the possible ways of adapting the concept of neighborhoods EE Leizerovich to the directions of contemporary interdisciplinary studies of rural-urban typologies. |
| Keywords: | Leizerovich E.E., socio-spatial research |
| Date: | 2016–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:wpaper:1037&r=ure |
| By: | Alejandro Badel; Carlos Castro; Cristhian Rodriguez |
| Abstract: | We look at the empirical validity of Schelling’s models for racial residential segregation applied to the case of Chicago. Most of the empirical literature has focused exclusively the single neighborhood model, also known as the tipping point model and neglected a multineighborhood approach or a unified approach. The multi-neighborhood approach introduced spatial interaction across the neighborhoods, in particular we look at spatial interaction across neighborhoods sharing a border. An initial exploration of the data indicates that spatial contiguity might be relevant to properly analyze the so call tipping phenomena of predominately non-Hispanic white neighborhoods to predominantly minority neighborhoods within a decade. We introduce an econometric model that combines an approach to estimate tipping point using threshold effects and a spatial autoregressive model. The estimation results from the model disputes the existence of a tipping point, that is a discontinuous change in the rate of growth of the non-Hispanic white population due to a small increase in the minority share of the neighborhood. In addition, we find that racial distance between the neighborhood of interest and the surrounding neighborhoods has an important effect on the dynamics of racial segregation in Chicago. |
| Keywords: | Racial residential segregation, tipping point, spatial econometrics, Chicago. |
| JEL: | J15 R23 |
| Date: | 2016–05–20 |
| URL: | http://d.repec.org/n?u=RePEc:col:000092:014589&r=ure |
| By: | Sándor Juhász; Balázs Lengyel |
| Abstract: | Knowledge networks in industrial clusters are frequently analyzed but we know very little about creation and persistence of ties in these networks. We argue that tie creation primarily depends on opportunities and thus the position ofactors in the network and in space; while tie persistence is influenced by the value of the tie. Accordingly, results from a Hungarian printing and paper product cluster suggest that reciprocity, triadic closure, and geographical proximity between firms increase the probability of tie creation. Tie persistence is positively affected by technological proximity between firms and the number of their extra-regional ties. |
| Keywords: | knowledge networks, clusters, network dynamics, stochastic actor-oriented models |
| JEL: | D85 L14 R11 O31 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1613&r=ure |
| By: | McNamara, Paul; Lee, Han Bum |
| Abstract: | Despite the extensive research exploring the effects of public provision of subsidized housing opportunities in urban areas, especially large cities, in the United States, very little or no research exists concerning the geographical inequality of federally funded rental subsidy programs in rural areas. This paper uses a multilevel modelling approach to analyze the extent rural-urban spatial disproportionality exist in rental subsidy programs of the U.S. Department of Housing and Urban Development (HUD) across all counties in the 48 contiguous states. Results indicate that rural residents in poverty are less likely to receive the rental subsidies by approximately 3.4 – 7.1 percentage points, based on different rural-urban geographical classifications and model specifications, than those in urban areas. Also, the predicted estimates of heterogeneous state effects reveal intergovernmental relationship of particularly how a state is involved in local government’s administration of the rental subsidy programs. |
| Keywords: | Rural poverty, HUD rental subsidy programs, Geographical inequality, Public Economics, |
| Date: | 2016–05–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea16:235471&r=ure |
| By: | Melo, Grace; Ames, Glenn |
| Abstract: | This study employs panel data to analyze the economic factors that drive rural-urban migration and agricultural labor supply within China. The results indicate that higher wages in urban areas, especially in the construction sector, was associated with rural-urban migration and a decline in the agricultural labor supply. The rural-urban wage differential in construction reflects the housing boom in cities set off by rapid urbanization and government policies. Most importantly, our findings raise concerns about the negative impact of rural-urban migration on agriculture in China. Policies that impact labor supply, especially in times of rapid urban development and low diffusion of agricultural technology, are critical to Chinese economic development and stability. |
| Keywords: | Internal migration, agricultural labor, Agricultural and Food Policy, Labor and Human Capital, O15, R23, J43, |
| Date: | 2016–05–23 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea16:235508&r=ure |
| By: | Dieter von Fintel (Department of Economics, University of Stellenbosch) |
| Abstract: | Whereas some previous microeconometric evidence suggests that wage setters in South Africa are highly responsive to external local labour market circumstances, this is not corroborated by macroeconomic studies. This question is interrogated again, with particular attention to methodological issues in wage curve estimation. The latter is a robust negative relationship between individuals’ wages and local unemployment rates, found in most countries, except where bargaining is highly centralized. Adding time variation to the micro data allows controls for spatial heterogeneity to be introduced, leading to the conclusion that wages are really inflexible in the short-run. Rather, the trade-off between wages and local unemployment that previous work has found represents a long-run spatial pattern. This finding is robust to instrumentation for reverse causality and the measurement error that is associated with choosing incorrect labour market demarcations. Additionally, this paper disputes the notion that very small geographic regions are appropriate to define “local” labour markets. Specifically, former magisterial districts appear to be smaller than the functional regions for which wage setters take labour market information into account. District councils tend to offer the most appropriate definitions. This concurs with the fact that collective bargaining councils “galvanise” smaller areas into larger wage setting regions, encompassing multiple magisterial districts. The role of bargaining councils is further investigated, with wage curve elasticities tending to be significantly negative for wage setters that work in the small firm, non-unionised sector. This points to the fact that the short-run inflexibility that is found overall is driven by sub-samples of larger firms with high concentrations of unionised workers. This section of the labour market appears to be insulated from the pressures of high unemployment in the short run. |
| Keywords: | South Africa; labour market flexibility; unemployment; wage curve; spatial lags; regional heterogeneity; local labour markets |
| JEL: | J31 J51 C21 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:sza:wpaper:wpapers265&r=ure |
| By: | Peralta, Denis; Kim, Man-Keun |
| Abstract: | This paper addresses a research gap in the literature by investigating the impact of big-box retailers’ presence on personal income growth in U.S. counties between 2000 and 2005, based on neoclassical growth models of cross-country income convergence. Whether big-box retailers have a negative effect on local economic growth has been a permeating question amongst regional developers, policy makers and economists. Walmart’s and Target’s economic impacts are estimated in regards to the degree in which their individual presence affects personal income growth. Different model specifications are applied in the analysis, including spatial models that control for spatial autocorrelation. Results suggest that counties with the presence of both Walmart and Target stores have experienced slower growth in personal income - even after controlling for spatial autocorrelation. Walmart’s individual effect on personal income growth is negative and highly significant. Target’s individual effect is also negative, but statistically insignificant after controlling for spatial dependence. |
| Keywords: | Big-box retailers, Growth, Income convergence, Personal income, Spatial econometrics, Walmart, Target, Agribusiness, Community/Rural/Urban Development, O47, O51, R11, |
| Date: | 2016–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea16:235216&r=ure |
| By: | Ayako Wakano (Graduate School of Economics, Osaka University) |
| Abstract: | Do locally hired teachers benefit pupils f school achievements more than governmental employed teachers? In Republic of Kenya (below referred as Kenya), there are two types of teachers in public primary schools. One is those employed by the government and the other is those hired by the local school community, named gPTA teacher h. Though locally hired teachers are in general less qualified in terms of educational background and paid substantially lower than that of governmentally employed teachers, past randomized experiment results show that the marginal product in terms of test score is positive and significant when pupils are taught by PTA teachers (Duflo et al. 2012, and Bold et al., 2013). By using a nationally representative rich data set, with the Generalized propensity score matching method, the present study examines the effect of PTA teacher ratio (ratio of PTA teachers out of total number of teachers) on education outcome. The question of this study is gif PTA teachers have superior performance, proved by the Randomized Controlled trial in Kenya, should higher PTA teacher ratio in one school bring better educational outputs? h. With the nationally representative dataset containing rich educational school inputs as well as individual pupils f background and household information, this paper estimates the dose response function of school average outcomes. Provided that government teachers f allocation and school selection by the parents can be an endogenous to pupils f school outcomes, this paper utilizes the generalized propensity score method by Hirano and Imbens (2004) which enable us to estimate the function of the continuous treatment effect, PTA teacher ratio. The result consistently shows that the PTA teacher ratio affects school outcomes nonlinearly. |
| Keywords: | Continuous treatment, Generalized propensity score, Program evaluation |
| JEL: | C30 C32 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:1615&r=ure |
| By: | Takaki Sato; Yasumasa Matsuda |
| Abstract: | This paper proposes spatial autoregressive conditional heteroscedasticity (S- ARCH) models to estimate spatial volatility in spatial data. S-ARCH model is a spatial extension of time series ARCH model. S-ARCH models specify conditional variances as the variances given the values of surrounding observations in spatial data, which is regarded as a spatial extension of time series ARCH models that spec- ify conditional variances as the variances given the values of past observations. We consider parameter estimation for S-ARCH models by maximum likelihood method and propose test statistics for ARCH effects in spatial data. We demonstrate the empirical properties by simulation studies and real data analysis of land price data in Tokyo. |
| Date: | 2016–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:toh:tergaa:348&r=ure |
| By: | Stefano Bosi (EPEE - Université d'Evry); Cuong Le Van (Centre d'Economie de la Sorbonne - Paris School of Economics, IPAG Business School); Ngoc-Sang Pham (EPEE - Université d'Evry and LEM - Université de Lille 3) |
| Abstract: | This paper considers rational land and housing bubbles in an infinite-horizon general equilibrium model. Their demands rest on two different grounds: the land is an input to produce while the house may be consumed. Our work differs from the existing literature in two respects. First, dividends on both these long-lived assets are endogenous and their sequences are computed. Second, we introduce and study different concepts of bubbles, including individual and strong bubbles |
| Keywords: | infinite horizon; general equilibrium; land bubble; housing bubble |
| JEL: | C62 D51 D9 G13 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:16027&r=ure |
| By: | Rolando Avendaño; Felipe Barrera-Osorio; Sebastián Nieto Parra; Flora Vever |
| Abstract: | This paper studies the linkages between schools’ inputs and students’ performance in Latin America. We exploit the richness of PISA 2012 questionnaires at the student and school level to study the association between a different set of inputs and students’ performance in mathematics. First, this research shows that students’ characteristics and their environment (i.e. sex, age and economic, social and cultural status of students and schools) explain close to 30% of the variation in education performance in Latin America, a higher percentage than in OECD and other economies which participated in PISA 2012. Second, after controlling for students’ characteristics and their environment, our results show that in Latin America, some non-traditional school inputs, such as the feedback provided by the principal to the teacher, weekly instructional time or the attitude and motivation of teachers, are associated with student performance, whereas more traditional inputs (e.g. school infrastructure, share of certified teachers and teacher qualifications) are not always related to better learning outcomes. These findings suggest that some pedagogical initiatives, which are also more cost-effective, could improve students’ performance in the region. Cet article étudie les liens entre les politiques en matière d’éducation et la performance des étudiants en Amérique latine. Nous exploitons la richesse de la base de données de PISA 2012 générée à partir des questionnaires soumis aux étudiants et aux écoles visant à analyser l'association entre certaines variables liées aux politiques éducatives avec la performance des élèves en mathématiques. Tout d'abord, cette recherche montre que les caractéristiques des élèves et leur environnement (sexe, âge et situation économique, sociale et culturelle des élèves et des écoles) expliquent près de 30% de la variation de la performance des étudiants en Amérique latine, un pourcentage plus élevé que dans les pays de l’OCDE et d'autres économies participant à PISA 2012. Deuxièmement, après avoir contrôlé les caractéristiques des étudiants et leur environnement, nos résultats montrent qu'en Amérique latine certaines politiques « non traditionnelles » pratiquées par certaines écoles, telles que les évaluations des enseignants réalisées par le principal, le temps d'enseignement hebdomadaire ou l'attitude et la motivation des enseignants, ont une influence sur la performance des élèves, alors que certaines politiques traditionnelles, telles que les infrastructures scolaires, la part des enseignants certifiés, les qualifications des enseignants n’en ont pas. Ces résultats suggèrent que des initiatives pédagogiques présentant un bon rapport en termes de coûts et d’efficacité peuvent être mises en oeuvre en Amérique latine pour améliorer la performance des élèves dans la région. |
| Keywords: | Latin America, secondary education, PISA, educational performance, Amérique latine, PISA, éducation secondaire |
| JEL: | H41 H52 I21 I25 |
| Date: | 2016–05–18 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaaa:331-en&r=ure |
| By: | Carlino, Gerald; Kerr, William R. |
| Abstract: | This paper reviews academic research on the connections between agglomeration and innovation. We first describe the conceptual distinctions between invention and innovation. We then discuss how these factors are frequently measured in the data and note some resulting empirical regularities. Innovative activity tends to be more concentrated than industrial activity, and we discuss important findings from the literature about why this is so. We highlight the traits of cities (e.g., size, industrial diversity) that theoretical and empirical work link to innovation, and we discuss factors that help sustain these features (e.g., the localization of entrepreneurial finance). |
| Keywords: | agglomeration, clusters, innovation, invention, entrepreneurship |
| JEL: | J2 J6 L1 L2 L6 O3 R1 R3 |
| Date: | 2015–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:bof:bofrdp:2015_027&r=ure |
| By: | Acemoglu, Daron; Akcigit, Ufuk; Kerr, William R. |
| Abstract: | The propagation of macroeconomic shocks through input-output and geographic networks can be a powerful driver of macroeconomic fluctuations. We first exposit that in the presence of Cobb-Douglas production functions and consumer preferences, there is a specific pattern of economic transmission whereby demand-side shocks propagate upstream (to input-supplying industries) and supply-side shocks propagate downstream (to customer industries) and that there is a tight relationship between the direct impact of a shock and the magnitudes of the downstream and the upstream indirect effects. We then investigate the short-run propagation of four different types of industry-level shocks: two demand-side ones (the exogenous component of the variation in industry imports from China and changes in federal spending) and two supply-side ones (TFP shocks and variation in knowledge/ideas coming from foreign patenting). In each case, we find substantial propagation of these shocks through the input-output network, with a pattern broadly consistent with theory. Quantitatively, the network-based propagation is larger than the direct effects of the shocks. We also show quantitatively large effects from the geographic network, capturing the fact that the local propagation of a shock to an industry will fall more heavily on other industries that tend to collocate with it across local markets. Our results suggest that the transmission of various di¤erent types of shocks through economic networks and industry interlinkages could have first-order implications for the macroeconomy. |
| Keywords: | economic fluctuations, geographic collocation, input-output linkages, networks, propagation, shocks |
| JEL: | E32 |
| Date: | 2015–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:bof:bofrdp:2015_025&r=ure |
| By: | Dörsam, Michael; Lauber, Verena |
| Abstract: | A recent education reform in Germany reduced the duration of academic high school education by one year but left the curriculum, and total class time unchanged. We use a unique data set of university students to investigate the e ects of this reduction in years of schooling on academic achievements at the tertiary level. By exploiting variation in the implementation of the reform across school types over time, we isolate the reform e ect from cohort, state, and school type e ects. Our results suggest that the reform lowers the opportunity costs of schooling and facilitates an earlier labor market entry as we nd no detrimental e ects while students are one year younger on average. |
| Keywords: | School Duration,Academic Achievement,Difference-in-Differences,Germany |
| JEL: | I21 H52 C21 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc15:140876&r=ure |
| By: | Lopez-Cermeño, Alexandra |
| Abstract: | This paper provides a simplified method of exploring the geographical limits of a knowledge shock over the long run. Using a geographically decomposable distance weighed sum of world GDPs by county, differences in differences regression analysis shows that a new university will not only have a positive impact on the local economy, but also on the GDP of nearby counties. Furthermore, challenging the conventional wisdom that knowledge spillovers affect the local economy, this study provides evidence that the effect expands to the whole national though its strength dilutes with distance. Consistent with the education literature, this investigation provides evidence that the shock will make the relative GDP of foreign competitors worse-off. Results are persistent in the long run, although the effect of time is also decreasing. Resultsare robust to potential endogeneity related to the self-selection of prosperous allocations for new academic institutions. |
| Keywords: | U.S. Counties; Spillovers; New Economic Geography |
| JEL: | O18 R11 N72 L8 |
| Date: | 2016–04 |
| URL: | http://d.repec.org/n?u=RePEc:cte:whrepe:22859&r=ure |
| By: | Hattendorff, Christian |
| Abstract: | The paper investigates the relationship between economic concentration and level of financial development to illuminate the linkage of real economy structure and financial markets. Using data from 81 Russian regions for the period 2005–2011, empirical evidence is offered to show that poor diversification weakens credit. Geographical variables are used as instruments of concentration in accounting for endogeneity. This work supports previous findings at the national level that policymakers seeking to promote economic development should place stronger emphasis on output diversification. |
| Keywords: | economic concentration, diversification, financial development, Russia |
| JEL: | E51 O11 R11 |
| Date: | 2015–05–18 |
| URL: | http://d.repec.org/n?u=RePEc:bof:bofitp:2015_018&r=ure |
| By: | Linda Gonçalves Veiga (Universidade do Minho - NIPE); Francisco veiga (Universidade do Minho - NIPE) |
| Abstract: | This paper analyzes the effects of the introduction of term limits at the local government level, using the Portuguese case as a natural experiment. Term limits became binding in the 2013 municipal elections, forcing 52% of the incumbent mayors to step down. The effects of this institutional change are studied using a differences-in-differences approach, on a sample comprising all Portuguese municipalities, from 1998 to 2013, and detailed data on local finances and municipal and mayor characteristics. The results indicate some benefits of term limits, such as the mitigation of the opportunistic manipulation of local finances, which has been more prevalent among more experienced eligible mayors. |
| Keywords: | term limits, fiscal policy, local government, Portugal, natural experiment. |
| JEL: | D7 H7 P16 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:7/2016&r=ure |
| By: | Carl T. Kitchens; Taylor Jaworski |
| Abstract: | In this paper, we quantify the difference between public and private prices of residential electricity immediately before and after major federal reforms in the 1930s and 1940s. Previous research found that public prices were lower in a sample of large, urban markets. Based on new data covering over 15,000 markets and nearly all electricity generated for residential consumption, we find the difference between public and private prices was small in 1935 and negligible in 1940 for typical levels of monthly consumption. These findings are consistent with a market for ownership that helped to discipline electricity prices during this period. That is, private rents were mitigated by the threat that municipalities would use public ownership to respond to constituent complaints and public rents were limited by electoral competition and the growth of private provision. |
| JEL: | D4 N12 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22254&r=ure |
| By: | Christopoulos, George (UNU‐MERIT, Maastricht University); Wintjes, René (UNU‐MERIT, Maastricht University) |
| Abstract: | This paper introduces a new approach for the definition of innovation clusters, based on the co-location of concentrated patenting and manufacturing activity in the EU. The incorporation of data on both the production and use of technologies results in an indicator that depicts both formal and informal modes of innovation and conditions which can be expected to be conducive to the generation, diffusion and absorption of innovation, and consequently the enhancement of competitiveness. Our findings indicate that certain types of patenting and manufacturing activity tend to co-locate. The sectoral-technological composition of the three types of concentrations observed points towards a higher level of diversity than one would expect in the case of narrow specialisation. Applying the new indicator in a test of the often hypothesised benefits of innovative clustering, we find that the identified clusters have consistently higher wages in the sectors concerned. |
| Keywords: | Innovation, clusters, regional studies, patenting, manufacturing |
| JEL: | O30 R12 L60 |
| Date: | 2016–05–11 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2016023&r=ure |
| By: | Andrietti, Vincenzo |
| Abstract: | This paper exploits a unique universal educational policy - implemented in most German states between 2001 and 2008 - that compressed the academic-track high school curriculum into a (one year) shorter time span, thereby increasing time of instruction and share of curriculum taught per grade. Using 2000-2012 PISA data and a quasi-experimental approach, I estimate the impacts of this intensified curriculum on cognitive skills. I find robust evidence that the reform improved, on average, the reading, mathematical, and scientific literacy skills acquired by academic-track ninth graders upon treatment. However, I also provide evidence that the reform widened the gap in student performance with respect to parental migration background and student ability. Finally, although the reform did not affect, on average, high school grade retention, I find that the latter increased for students with parental migration background. Taken together, these findings suggest that moving to a compressed high-school curriculum did not compromise and benefited, on average, students' cognitive skills. However, they also raise equity concerns that policy-makers should be aware of. |
| Keywords: | G8 reform,Intensified curriculum,Instruction time,Learning intensity,Cognitive skills,Academic-track high school,Grade retention,Remedial education |
| JEL: | I21 I28 D04 |
| Date: | 2016–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:140618&r=ure |
| By: | Faggian, Alessandra; Partridge, Mark; Malecki, Ed |
| Abstract: | Researchers have long searched for the underlying causes of growth. In developed countries, as they shifted from industrial to knowledge economies, researchers have recently stressed the following sources of growth embodied in its workforce: human capital (linked to education), entrepreneurship (variously measured), and the creative class (associated with worker occupations). This study first proposes new conceptual ways to portray the interrelationship of these knowledge-based attributes. Then simultaneously considers all of these factors in an empirical model using U.S. counties. We find that human capital as measured by educational attainment and the intensity of small and medium-sized firms are statistically associated with subsequent growth, while other factors such as the share of creative class workers or the share of advanced technology industries are insignificant. We conclude that economic development strategies are too focused on attracting large outside firms and attracting advanced technology firms and not enough attention is given to building a foundation of competitive small and medium-sized firms. |
| Keywords: | Economic growth, human capital, entrepreneurship, creative class, US counties |
| JEL: | J24 O1 R11 |
| Date: | 2016–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:71445&r=ure |
| By: | Cleo Jacobs Johnson; Ava Madoff; Scott Richman; Matthew Johnson; Claudia Gentile |
| Abstract: | After years of operating programs focused on improving education in Kansas City, Kauffman Foundation leaders decided to establish charter school. The path they followed and the lessons they learned may be of interest to those working to found and/or improve charter schools. |
| Keywords: | Kauffman, Charter School, Academic growth, education |
| JEL: | I |
| Date: | 2016–03–16 |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:5ea03c380804432f97d25d1df22e03bc&r=ure |
| By: | Mundra, Kusum (Rutgers University); Uwaifo Oyelere, Ruth (affiliation not available) |
| Abstract: | In recent years, singles have begun to take on a more prominent role in reshaping America. As a group, singles are increasingly becoming influential in politics and in the determination of many macro socioeconomic outcomes. In this descriptive paper we focus on homeownership among a subset of singles, the never married. In particular we investigate potential differences in the relationship between several homeownership determinants for singles in comparison to the married. In addition, we test for heterogeneity across race and skill level in the gender gap in homeownership and the probability of homeownership before and post the recession. Our results suggest that there are some differences in the relationship between certain factors and homeownership for singles versus those who are married. In particular, we find age, gender, and number of children affect the probability of homeownership differently for singles compared to those who are married. We also find that while on average there is a higher probability of homeownership from 2007 onwards for singles, there are gender, education and racial differences. Our results also suggest significant heterogeneity across race and skill level in homeownership probabilities for singles. |
| Keywords: | homeownership, single, ethnicity, gender, race, recession |
| JEL: | J10 J11 D10 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9935&r=ure |
| By: | Yagi, Michiyuki; Managi, Shunsuke |
| Abstract: | This study empirically examines the demographic determinants of car ownership in Japan between 1980 and 2009. Unique car cohort data, composed of the car age and 11 car types, at the prefectural level, is analyzed. The primary reason for examining the demographic determinants of car ownership in Japan is because Japan is projected to face radical demographic changes in the next few decades. These projected changes include depopulation and an aging population with diminishing household size. This study will be the first empirical study of the car cohort model with large countrywide observations in the recent literature. This study classifies the demographic determinants into five categories: (I) longitudinal factors, (II) economic factors, (III) natural factors, (IV) social factors, and (V) other transports. Although some tendencies vary among car types, this study finds the following tendencies of ordinary car ownership (compact four-wheel drive trucks and regular and compact passenger cars). Regarding the longitudinal factors, the long-run effect is much higher than average in the recent literature, whereas the semi elasticity of car age is approximately −7%. Regarding the economic factors, the elasticities of income and fuel price on car ownership tend to be less intense than in earlier studies. Regarding the natural factors of population increase, the elasticities of population and average household size on car ownership tend to be negative. This indicates that a decrease in population and household size in Japan will accelerate car ownership. In addition, the ratio of elderly people has various effects depending on car types. Regarding the social factors of population increase, car ownership tends to be encouraged by the concentration of population within prefecture, and increased and decreased for relatively new (aged 2-11) and old (aged 12+) cars, respectively, by the concentration of population across prefectures. The former is probably due to a composite effect in urban and rural areas, whereas the latter may be a quick update cycle due to an effect of urbanization. Regarding other transports, the degrees of train and bus use tend to be negatively associated with ordinary car ownership. However, these effects are considerably small and often insignificant as in the literature. |
| Keywords: | car cohort; demographic determinants; car ownership in Japan; car aggregated model |
| JEL: | L62 R10 R40 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:71614&r=ure |
| By: | Khizar Qureshi; Cheng Su |
| Abstract: | In general, homeowners refinance in response to a decrease in interest rates, as their borrowing costs are lowered. However, it is worth investigating the effects of refinancing after taking the underlying costs into consideration. Here we develop a synthetic mortgage calculator that sufficiently accounts for such costs and the implications on new monthly payments. To confirm the accuracy of the calculator, we simulate the effects of refinancing over 15 and 30 year periods. We then model the effects of refinancing as risk to the issuer of the mortgage, as there is negative duration associated with shifts in the interest rate. Furthermore, we investigate the effects on the swap market as well as the treasury bond market. We model stochastic interest rates using the Vasicek model. |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1605.04941&r=ure |
| By: | Adam Jaffe (Freelance Researcher); Arthur Grimes (Motu Economic and Public Policy Research); Levante Timar (Motu Economic and Public Policy Research) |
| Abstract: | The 2010/2011 Canterbury earthquakes caused major upheaval to the people of the region. The second major quake killed 185 people, forced many from their homes, and closed Christchurch’s central business district. This paper examines the consequential effect on jobs and accumulated earnings for workers in Canterbury. In addition, we examine concurrent decisions about employment location, including job-to-job transitions and regional migration. While Canterbury workers’ employment outcomes were adversely affected in the short-run, those workers were more likely to have jobs three years later (relative to a matched control group), and to have higher accumulated earnings. At the same time, they were less likely to be at the same employer, and more likely to have migrated to jobs in other New Zealand regions. Impacts vary substantially by worker characteristics and by the naturally-induced geographic variation in the severity of the shock. We show that the Earthquake Support Subsidy appears to have influenced the extent of outward migration decisions, at least for most types of workers, though not the long-term retention of the pre-quake job under which the subsidy was gained. We interpret these findings as evidence that the subsidy achieved its goal of delaying involuntary job loss and, as a result, fewer workers made immediate decisions to leave the region – decisions that persisted over the long-run. |
| Keywords: | Natural disasters; employment; migration; response to shocks; difference-in-difference |
| JEL: | D22 L11 Q54 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:mtu:wpaper:16_07&r=ure |
| By: | Daganzo, Carlos; Anderson, Paul |
| Abstract: | Transfers are a major source of travel time variability for transit passengers. Coordinating transfers between transit routes in real time can reduce passenger waiting times and travel time variability, but these benefits need to be contrasted with the delays to on-board and downstream passengers, as well as the potential for bus bunching created by holding buses for transfers. We developed a dynamic holding strategy for transfer coordination based on control theory. We then obtained the optimal control strategy, where maximum holding time is a function of real-time estimates of bus arrivals and passengers and the uncertainty in these estimates. Total travel time (waiting plus in-vehicle) with the optimal control is found to be globally less than or equal to total travel time without control when uncertainty is bounded. The time savings from transfer coordination increase with the ratio of transferring to through passengers but diminish as uncertainty in the real-time estimates of bus arrivals increases. Field observations at a multimodal transfer point in Oakland show that the proposed control strategy could reduce net transfer delay by 30-39% in a real-world scenario. The data collected also confirm that the upper bound on uncertainty in bus arrivals can be satisfied with existing bus location technology. We conclude with a discussion of complementary measures, such as the provision of real-time information at transfer points and conditional signal priority, which could allow coordination to be applied in more cases. |
| Keywords: | Engineering, Public transportation, interlining, transfers, coordination |
| Date: | 2016–05–06 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsrrp:qt25h4r974&r=ure |
| By: | Shr, Yau-Huo; Zipp, Katherine |
| Keywords: | Hedonic price model, Nonmarket valuation, Environmental Economics and Policy, Q51, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea16:235961&r=ure |
| By: | Blerjana Bino; Ketrina Çabiri; Erjon Curraj; Alban Hashani; Ilire Mehmeti |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:wii:bpaper:113&r=ure |