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Yet Another Tale of Two Cities: Buenos Aires and Chicago

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  • Filipe Campante
  • Edward L. Glaeser

Abstract

Buenos Aires and Chicago grew during the nineteenth century for remarkably similar reasons. Both cities were conduits for moving meat and grain from fertile hinterlands to eastern markets. However, despite their initial similarities, Chicago was vastly more prosperous for most of the 20th century. Can the differences between the cities after 1930 be explained by differences in the cities before that date? We highlight four major differences between Buenos Aires and Chicago in 1914. Chicago was slightly richer, and significantly better educated. Chicago was more industrially developed, with about 2.25 times more capital per worker. Finally, Chicago’s political situation was far more stable and it wasn’t a political capital. Human capital seems to explain the lion’s share of the divergent path of the two cities and their countries, both because of its direct effect and because of the connection between education and political instability.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 15104.

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Date of creation: Jun 2009
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Handle: RePEc:nbr:nberwo:15104

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  1. Robert E. Hall & Charles I. Jones, 1999. "Why Do Some Countries Produce So Much More Output per Worker than Others?," NBER Working Papers 6564, National Bureau of Economic Research, Inc.
  2. Ades, Alberto F & Glaeser, Edward L, 1995. "Trade and Circuses: Explaining Urban Giants," The Quarterly Journal of Economics, MIT Press, vol. 110(1), pages 195-227, February.
  3. Filipe R. Campante & Quoc-Anh Do, 2009. "A Centered Index of Spatial Concentration: Axiomatic Approach with an Application to Population and Capital Cities," Working Papers 02-2009, Singapore Management University, School of Economics.
  4. Murphy, Kevin M. & Shleifer, Andrei & Vishny, Robert W., 1989. "Industrialization and the Big Push," Scholarly Articles 3606235, Harvard University Department of Economics.
  5. Orley Ashenfelter & Alan Krueger, 1992. "Estimates of the Economic Return to Schooling from a New Sample of Twins," Working Papers 683, Princeton University, Department of Economics, Industrial Relations Section..
  6. Rauch, James E, 1993. "Does History Matter Only When It Matters Little? The Case of City-Industry Location," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 843-67, August.
  7. DiPasquale, Denise & Glaeser, Edward L., 1999. "Incentives and Social Capital: Are Homeowners Better Citizens?," Journal of Urban Economics, Elsevier, vol. 45(2), pages 354-384, March.
  8. Campante, Filipe R. & Chor, Davin, 2008. "Schooling and Political Participation in a Neoclassical Framework: Theory and Evidence," Working Paper Series rwp08-043, Harvard University, John F. Kennedy School of Government.
  9. Edward L. Glaeser & Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2004. "Do Institutions Cause Growth?," Journal of Economic Growth, Springer, vol. 9(3), pages 271-303, 09.
  10. Edward Glaeser & Giacomo Ponzetto & Andrei Shleifer, 2006. "Why Does Democracy Need Education?," NBER Working Papers 12128, National Bureau of Economic Research, Inc.
  11. Campante, Filipe & Do, Quoc-Anh, 2007. "Inequality, Redistribution, and Population," Working Paper Series rwp07-046, Harvard University, John F. Kennedy School of Government.
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Cited by:
  1. Murtin, Fabrice & Wacziarg, Romain, 2011. "The Democratic Transition," CEPR Discussion Papers 8599, C.E.P.R. Discussion Papers.
  2. Campante, Filipe & Do, Quoc-Anh & Guimarães, Bernardo, 2013. "Isolated Capital Cities and Misgovernance: Theory and Evidence," CEPR Discussion Papers 9284, C.E.P.R. Discussion Papers.
  3. Borowiecki, Karol Jan, 2012. "History matters: The origins of cultural supply in Italy," Discussion Papers of Business and Economics 15/2012, Department of Business and Economics, University of Southern Denmark.

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