Friday, Jan. 6, 2017 10:15 AM – 12:15 PM
Hyatt Regency Chicago, Michigan 3
- Chair: Stephen Redding, Princeton University
Cities, Skills, and Sectors in Developing Economies
AbstractIn developed economies, larger cities are skill-abundant and specialize in skill-intensive activities. This paper characterizes the spatial distributions of skill and sectors in Brazil, China, and India. To facilitate comparisons with developed-economy findings, we construct metropolitan areas from finer geographic units for each economy. We then compare and contrast the spatial distributions of educational attainment, industrial employment, and occupational employment across Brazil, China, India, and the United States.
AbstractDuring the last five decades the city of Detroit, Michigan has experienced large declines in population that have shrunk the city to about one third of its largest size. These declines have created a variety of problems related to both the city’s finances and its urban structure. The current structure of the city is clearly ill-suited for its current population size, with a large number of vacant houses and lots close to large employment areas in downtown Detroit. We propose a structural model of the city with residential and business location choices, as well as the presence of residential developers. Coordination problems lead to multiple equilibria in the development of residential neighborhoods that can explain the lack of new residential development in areas close to thriving commercial centers. We use detailed data for Detroit to structurally estimate the model and propose several policies to solve the measured coordination problems and make the city structure more suitable for its current size. The framework and lessons we derive from Detroit can be readily applied to a number of other declining cities.
Estimating Neighborhood Effects: Evidence From War-Time Destruction in London
AbstractWe use Second World War destruction in London as a natural experiment to provide evidence on neighborhood effects. We use a newly-collected and remarkable dataset on thousands of locations within London that records wartime destruction and the economic and social characteristics of locations from the late-nineteenth to late-twentieth centuries. We combine these data with a quantitative model of the sorting of heterogeneous groups of agents across locations that differ in productivity, amenities and trans- port infrastructure. We find that both own and neighbors’ destruction affect patterns of spatial sorting and that the effects of neighbors’ destruction are highly localized (0-200 meters). These findings provide evidence for spatial sorting as a mechanism through which neighborhood effects occur.
- J1 - Demographic Economics
- R1 - General Regional Economics