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Determinants of City Growth in Brazil

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  • Daniel da Mata
  • Uwe Deichmann
  • J. Vernon Henderson
  • Somik V. Lall
  • Hyoung G. Wang

Abstract

In this paper, we examine the determinants of Brazilian city growth between 1970 and 2000. We consider a model of a city, which combines aspects of standard urban economics and the new economic geography literatures. For the empirical analysis, we constructed a dataset of 123 Brazilian agglomerations, and estimate aspects of the demand and supply side as well as a reduced form specification that describes city sizes and their growth. Our main findings are that increases in rural population supply, improvements in inter-regional transport connectivity and education attainment of the labor force have strong impacts on city growth. We also find that local crime and violence, measured by homicide rates impinge on growth. In contrast, a higher share of private sector industrial capital in the local economy stimulates growth. Using the residuals from the growth estimation, we also find that cities who better administer local land use and zoning laws have higher growth. Finally, our policy simulations show that diverting transport investments from large cities towards secondary cities do not provide significant gains in terms of national urban performance.

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Bibliographic Info

Paper provided by Instituto de Pesquisa Econômica Aplicada - IPEA in its series Discussion Papers with number 1112.

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Length: 39 pages
Date of creation: Aug 2005
Date of revision:
Handle: RePEc:ipe:ipetds:1112

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  1. Alberto Alesina & Dani Rodrik, 1991. "Distributive Politics and Economic Growth," NBER Working Papers 3668, National Bureau of Economic Research, Inc.
  2. Rafael La Porta & Florencio López-De-Silanes, 1999. "The Benefits Of Privatization: Evidence From Mexico," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 114(4), pages 1193-1242, November.
  3. repec:fth:stanho:e-95-4 is not listed on IDEAS
  4. Edward L. Glaeser & Jose A. Scheinkman & Andrei Shleifer, 1995. "Economic Growth in a Cross-Section of Cities," NBER Working Papers 5013, National Bureau of Economic Research, Inc.
  5. Persson, Torsten & Tabellini, Guido, 1994. "Is Inequality Harmful for Growth?," American Economic Review, American Economic Association, American Economic Association, vol. 84(3), pages 600-621, June.
  6. Sanders Korenman & David Neumark, 2000. "Cohort Crowding and Youth Labor Markets (A Cross-National Analysis)," NBER Chapters, in: Youth Employment and Joblessness in Advanced Countries, pages 57-106 National Bureau of Economic Research, Inc.
  7. Giles Duranton & Diego Puga, 2003. "Micro-Foundations of Urban Agglomeration Economies," NBER Working Papers 9931, National Bureau of Economic Research, Inc.
  8. Da Mata, Daniel & Deichmann, Uwe & Henderson, J. Vernon & Lall, Somik V. & Wang, Hyoung Gun, 2005. "Examining the growth patterns of Brazilian cities," Policy Research Working Paper Series 3724, The World Bank.
  9. Mauro Borges Lemos & Sueli Moro & Elenice Biazi & Marco Aurélio Crocco, 2001. "A Dinâmica Urbana das Regiões Metropolitanas Brasileiras," Anais do XXIX Encontro Nacional de Economia [Proceedings of the 29th Brazilian Economics Meeting], ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Gr 073, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
  10. Galor, Oded & Zeira, Joseph, 1988. "Income Distribution and Macroeconomics," MPRA Paper 51644, University Library of Munich, Germany, revised 01 Sep 1989.
  11. Conley, T. G., 1999. "GMM estimation with cross sectional dependence," Journal of Econometrics, Elsevier, Elsevier, vol. 92(1), pages 1-45, September.
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