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Social Capital and Urban Growth

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  • Edward L. Glaeser
  • Charles Redlick

Abstract

Social capital is often place-specific while schooling is portable, so the prospect of migration may reduce the returns to social capital and increase the returns to schooling. If social capital matters for urban success, it is possible that an area can get caught in a bad equilibrium where the prospect of out-migration reduces social capital investment and a lack of social capital investment makes out-migration more appealing. We present a simple model of that process and then test its implications. We find little evidence to suggest that social capital is correlated with either area growth or rates of out-migration. We do, however, find significant differences in the returns to human capital across space, and a significant pattern of skilled people disproportionately leaving declining areas. For people in declining areas, the prospect of out-migration may increase the returns to investment in human capital, but it does not seem to impact investment in social capital.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 14374.

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Date of creation: Oct 2008
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Publication status: Published online before print June 12, 2009, doi: 10.1177/0160017609336079 International Regional Science Review July 2009 vol. 32 no. 3 264-299
Handle: RePEc:nbr:nberwo:14374

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References

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  1. Denise DiPasquale & Edward L. Glaeser, 1998. "Incentives and Social Capital: Are Homeowners Better Citizens?," NBER Working Papers 6363, National Bureau of Economic Research, Inc.
  2. Edward L. Glaeser & David Laibson & Bruce Sacerdote, 2002. "An Economic Approach to Social Capital," Economic Journal, Royal Economic Society, vol. 112(483), pages 437-458, November.
  3. Berry, Christopher R. & Glaeser, Edward L., 2005. "Divergence of Human Capital Levels across Cities," Working Paper Series rwp05-057, Harvard University, John F. Kennedy School of Government.
  4. Edward L. Glaeser & Joshua D. Gottlieb, 2008. "The Economics of Place-Making Policies," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 39(1 (Spring), pages 155-253.
  5. Christopher R. Berry & Edward L. Glaeser, 2005. "The divergence of human capital levels across cities," Papers in Regional Science, Wiley Blackwell, vol. 84(3), pages 407-444, 08.
  6. David Austen-Smith & Roland G. Fryer, 2005. "An Economic Analysis of "Acting White"," The Quarterly Journal of Economics, MIT Press, vol. 120(2), pages 551-583, May.
  7. Westlund, Hans & Bolton, Roger, 2003. " Local Social Capital and Entrepreneurship," Small Business Economics, Springer, vol. 21(2), pages 77-113, September.
  8. Luis Ubeda & Antonio Spilimbergo, 2002. "A Model of Multiple Equilibria in Geographic Labor Mobility," IMF Working Papers 02/31, International Monetary Fund.
  9. Christopher R. Berry & Edward L. Glaeser, 2005. "The Divergence of Human Capital Levels Across Cities," NBER Working Papers 11617, National Bureau of Economic Research, Inc.
  10. Christopher R. Berry & Edward L. Glaeser, 2005. "The Divergence of Human Capital Levels across Cities," Harvard Institute of Economic Research Working Papers 2091, Harvard - Institute of Economic Research.
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Citations

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Cited by:
  1. Alberto F. Alesina & Yann Algan & Pierre Cahuc & Paola Giuliano, 2010. "Family Values and the Regulation of Labor," NBER Working Papers 15747, National Bureau of Economic Research, Inc.
  2. Yamamura, Eiji, 2010. "How do neighbors influence investment in social capital? : Homeownership and length of residence," MPRA Paper 22637, University Library of Munich, Germany.
  3. Edward L. Glaeser & Joshua D. Gottlieb, 2009. "The Wealth of Cities: Agglomeration Economies and Spatial Equilibrium in the United States," Journal of Economic Literature, American Economic Association, vol. 47(4), pages 983-1028, December.
  4. Yamamura, Eiji, 2010. "Homeownership and investment for social capital in Japan: Dynamic Panel approach," MPRA Paper 26182, University Library of Munich, Germany.
  5. De Santis, Roberta & Fasano, Alessandra & Mignolli, Nadia & Villa, Anna, 2014. "Smart city: fact and fiction," MPRA Paper 54536, University Library of Munich, Germany.
  6. Yamamura, Eiji, 2009. "Comparison of the effects of homeownership by individuals and their neighbors on social capital formation: Evidence from Japanese General Social Surveys," MPRA Paper 19495, University Library of Munich, Germany.
  7. Soogwan Doh & Connie McNeely, 2012. "A multi-dimensional perspective on social capital and economic development: an exploratory analysis," The Annals of Regional Science, Springer, vol. 49(3), pages 821-843, December.
  8. Mundula, Luigi & Auci, Sabrina, 2013. "Smart Cities and a Stochastic Frontier Analysis: A Comparison among European Cities," MPRA Paper 51586, University Library of Munich, Germany.

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