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The Effect of Information and Communication Technologies on Urban Structure

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  • Yannis M. Ioannides
  • Henry G. Overman
  • Esteban Rossi-Hansberg
  • Kurt Schmidheiny

Abstract

Two innovations in the last century have changed dramatically the cost of communicating and transmitting information: The first is the widespread adoption of telephony; the second is the internet. We study the implications of these changes in ICT for urban structure. We find robust evidence that increases in the number of telephone lines per capita lead to a more concentrated distribution of city sizes and so correspondingly to more dispersion in the distribution of economic activity in space. The evidence on internet usage is more speculative, although it goes in the same direction. This empirical result is rationalized in a theoretical model.

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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2049.

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Date of creation: 2007
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Handle: RePEc:ces:ceswps:_2049

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  1. J.V. Henderson, 1972. "The Sizes and Types of Cities," Working Papers, Queen's University, Department of Economics 75, Queen's University, Department of Economics.
  2. Esteban Rossi-Hansberg & Mark L. J. Wright, 2007. "Urban Structure and Growth," Review of Economic Studies, Oxford University Press, vol. 74(2), pages 597-624.
  3. Diego Comin & Bart Hobijn, 2003. "Cross-country technology adoption: making the theories face the facts," Staff Reports 169, Federal Reserve Bank of New York.
  4. Martin, Philippe, 1999. "Public policies, regional inequalities and growth," Journal of Public Economics, Elsevier, vol. 73(1), pages 85-105, July.
  5. Ades, Alberto F & Glaeser, Edward L, 1995. "Trade and Circuses: Explaining Urban Giants," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 110(1), pages 195-227, February.
  6. Rosen, Kenneth T. & Resnick, Mitchel, 1980. "The size distribution of cities: An examination of the Pareto law and primacy," Journal of Urban Economics, Elsevier, vol. 8(2), pages 165-186, September.
  7. Duncan Black & Vernon Henderson, 2003. "Urban evolution in the USA," Journal of Economic Geography, Oxford University Press, vol. 3(4), pages 343-372, October.
  8. Kwok Tong Soo, 2004. "Zipf's law for cities: a cross country investigation," LSE Research Online Documents on Economics 19947, London School of Economics and Political Science, LSE Library.
  9. Gabaix, Xavier & Ioannides, Yannis M., 2004. "The evolution of city size distributions," Handbook of Regional and Urban Economics, Elsevier, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 53, pages 2341-2378 Elsevier.
  10. Xavier Gabaix & Rustam Ibragimov, 2006. "Log(Rank-1/2): A Simple Way to Improve the OLS Estimation of Tail Exponents," Harvard Institute of Economic Research Working Papers 2106, Harvard - Institute of Economic Research.
  11. Henderson, Vernon, 1997. "Medium size cities," Regional Science and Urban Economics, Elsevier, vol. 27(6), pages 583-612, November.
  12. Masahisa Fujita & Paul Krugman & Anthony J. Venables, 2001. "The Spatial Economy: Cities, Regions, and International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262561476, December.
  13. Paul Conway & Giuseppe Nicoletti, 2006. "Product Market Regulation in the Non-Manufacturing Sectors of OECD Countries: Measurement and Highlights," OECD Economics Department Working Papers 530, OECD Publishing.
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Cited by:
  1. Anastasios Xepapadeas & Efthymia Kyriakopoulou, 2009. "Environmental Policy, Spatial Spillovers and the Emergence of Economic Agglomerations," Working Papers 2009.70, Fondazione Eni Enrico Mattei.
  2. Kok, Suzanne & ter Weel, Bas, 2014. "Cities, Tasks and Skills," IZA Discussion Papers 8053, Institute for the Study of Labor (IZA).
  3. Joseph F. Francois & Miriam Manchin, 2007. "Institutions, infrastructure, and trade," Economics working papers 2007-05, Department of Economics, Johannes Kepler University Linz, Austria.
  4. Hong, Junjie & Fu, Shihe, 2008. "Information and communication technologies and geographic concentration of manufacturing industries: Evidence from China," MPRA Paper 7574, University Library of Munich, Germany.
  5. Suzanne Kok & Bas ter Weel, 2014. "Cities, Tasks and Skills," CPB Discussion Paper 269, CPB Netherlands Bureau for Economic Policy Analysis.
  6. Bas, Maria & Ledezma, Ivan, 2007. "Market Access and the Evolution of within Plant Productivity in Chile," Economics Papers from University Paris Dauphine 123456789/6913, Paris Dauphine University.
  7. Ibragimov, Marat & Ibragimov, Rustam & Kattuman, Paul, 2013. "Emerging markets and heavy tails," Journal of Banking & Finance, Elsevier, vol. 37(7), pages 2546-2559.
  8. Suzanne Kok, 2013. "Returns to Communication in Specialised and Diversified US Cities," CPB Discussion Paper 236, CPB Netherlands Bureau for Economic Policy Analysis.
  9. Ioannides, Yannis & Skouras, Spyros, 2013. "US city size distribution: Robustly Pareto, but only in the tail," Journal of Urban Economics, Elsevier, vol. 73(1), pages 18-29.

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