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US city size distribution: Robustly Pareto, but only in the tail

  • Ioannides, Yannis
  • Skouras, Spyros

We establish empirically using three different definitions of US cities that the upper tail obeys a Pareto law and not a lognormal distribution. We emphasize estimation of a switching point between the body of the city size distribution (which includes most cities) and its upper tail (which includes most of the population). For the 2000 Census Places data, in particular, our preferred model suggests that switching from a lognormal to a Pareto law occurs within a narrow confidence interval around population 60,290, with a corresponding Pareto exponent of 1.25. Most cities obey a lognormal; but the upper tail and therefore most of the population obeys a Pareto law. We obtain qualitatively similar results for the upper tail with the Area Clusters data of Rozenfeld et al. (2011), and the US Census combined Metropolitan and Micropolitan Areas data, though the shape of that distribution at smaller sizes is sensitive to the definition used.

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Article provided by Elsevier in its journal Journal of Urban Economics.

Volume (Year): 73 (2013)
Issue (Month): 1 ()
Pages: 18-29

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Handle: RePEc:eee:juecon:v:73:y:2013:i:1:p:18-29
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/622905

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  1. Gilles Duranton & Diego Puga, 2002. "From Sectoral to Functional Urban Specialization," NBER Working Papers 9112, National Bureau of Economic Research, Inc.
  2. J.V. Henderson, 1972. "The Sizes and Types of Cities," Working Papers 75, Queen's University, Department of Economics.
  3. Donald W.K. Andrews, 1999. "Testing When a Parameter Is on the Boundary of the Maintained Hypothesis," Cowles Foundation Discussion Papers 1229, Cowles Foundation for Research in Economics, Yale University.
  4. Yannis M. Ioannides & Henry G. Overman & Esteban Rossi-Hansberg & Kurt Schmidheiny, 2007. "The Effect of Information and Communication Technologies on Urban Structure," Discussion Papers Series, Department of Economics, Tufts University 0708, Department of Economics, Tufts University.
  5. Yannis M. Ioannides, 2012. "Preface
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  10. Giesen, Kristian & Zimmermann, Arndt & Suedekum, Jens, 2010. "The size distribution across all cities - Double Pareto lognormal strikes," Journal of Urban Economics, Elsevier, vol. 68(2), pages 129-137, September.
  11. Xavier Gabaix, 1999. "Zipf'S Law For Cities: An Explanation," The Quarterly Journal of Economics, MIT Press, vol. 114(3), pages 739-767, August.
  12. Henderson, Vernon, 1997. "Medium size cities," Regional Science and Urban Economics, Elsevier, vol. 27(6), pages 583-612, November.
  13. Yannis M. Ioannides, 2012. "From Neighborhoods to Nations: The Economics of Social Interactions," Economics Books, Princeton University Press, edition 1, volume 1, number 9892.
  14. William J. Reed, 2002. "On the Rank-Size Distribution for Human Settlements," Journal of Regional Science, Wiley Blackwell, vol. 42(1), pages 1-17.
  15. Gilles Duranton, 2007. "Urban Evolutions: The Fast, the Slow, and the Still," American Economic Review, American Economic Association, vol. 97(1), pages 197-221, March.
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