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Recent Advances in Quantitative Spatial Economics

Paper Session

Saturday, Jan. 8, 2022 3:45 PM - 5:45 PM (EST)

Hosted By: Econometric Society
  • Chair: Cecile Gaubert, University of California-Berkeley

Transportation, Gentrification, and Urban Mobility

Clare Balboni
,
Massachusetts Institute of Technology
Gharad Bryan
,
London School of Economics
Melanie Morten
,
Stanford University
Bilal Siddiqi
,
World Bank

Abstract

Roads, rail, and other public transport in a city are “place-based,” in that they are built in specific neighborhoods. Do such investments benefit the poor? If people are mobile within a city, then any such place-based investment can lead to neighborhood changes, such as rent increases, which change who can afford to live near these invest- ments and hence who benefits from them. We provide a tractable urban commuting model to study the distributional effects of urban infrastructure improvements. We derive intuitive “exact hat” expressions for the welfare change of initial residents after investment. We then apply the method to study the Dar es Salaam BRT system, using original panel data tracked on two dimensions (following households if they move and surveying all new residents of buildings). Preliminary results suggest that the BRT was a pro-poor investment: we estimate a welfare gain of 3.0% for incumbent low-income residents living near the BRT, compared with a 2.5% gain to incumbent high-income residents; across the city, poor gained on average 2.4% and rich gained 2.3%.

Skilled Scalable Services: The New Urban Bias in Economic Growth

Fabian Eckert
,
University of California-San Diego

Abstract

Since 1980, economic growth in the U.S. has been fastest in its largest cities. We show
that a group of skill- and information-intensive service industries are responsible for
all of this new urban bias in recent growth. We then propose a simple explanation centered around the interaction of three factors: the disproportionate reliance of
these services on information and communication technology (ICT), the precipitous
price decline for ICT capital since 1980, and the preexisting comparative advantage
of cities in skilled services. Quantitatively, our mechanism accounts for most of the
urban biased growth of the U.S. economy in recent decades.

Political Economy of Transport Investments: Evidence from the California High-Speed Rail

Pablo Fajgelbaum
,
Princeton University
Cecile Gaubert
,
University of California-Berkeley
Nicole Gorton
,
University of California-Los Angeles
Eduardo Morales
,
Princeton University
Edouard Schaal
,
CREI and Pompeu Fabra University

Abstract

We study the implications of taking into account political economy considerations when designing new transportation infrastructure.

Spatial Spillovers from Urban Redevelopments: Evidence from Mumbai's Textile Mills

Nick Tsivanidis
,
University of California-Berkeley
Michael Gechter
,
Pennsylvania State University

Abstract

This paper examines the impacts of building high-rise, market rate housing in the center of developing country cities. We exploit a unique policy experiment in Mumbai that suddenly led 15% of central city land occupied by the city’s defunct textile mills to be redeveloped into high rises during the 2000s. To measure the spatial spillovers from this new construction, we digitize a host of new spatially disaggregated administrative data and use machine vision and text classification techniques to measure changing slums and demographic composition nearby. We find evidence of sizable local spillovers that increase formal sector house prices and drive a process of gentrification where slums, low-skill population shares and informal employment all fall. To disentangle the source of these spillovers and quantify indirect and overall welfare effects, we develop and estimate a dynamic quantitative spatial model with informal housing, non-homothetic preferences and relocation frictions.
JEL Classifications
  • R2 - Household Analysis