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Cities, Skills and Regional Change

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  • Edward L. Glaeser
  • Giacomo A. M. Ponzetto
  • Kristina Tobio

Abstract

Glaeser E. L., Ponzetto G. A. M. and Tobio K. Cities, skills and regional change, Regional Studies . One approach to urban areas emphasizes the existence of certain immutable relationships, such as Zipf's or Gibrat's law. An alternative view is that urban change reflects individual responses to changing tastes or technologies. This paper examines almost 200 years of regional change in the United States and finds that few, if any, growth relationships remain constant, including Gibrat's law. Education does a reasonable job of explaining urban resilience in recent decades, but it does not seem to predict county growth a century ago. After reviewing this evidence, a simple model of regional change is presented and estimated, where education increases the level of entrepreneurship. Human capital spillovers occur at the city level because skilled workers produce more product varieties and thereby increase labour demand. It is found that skills are associated with growth in productivity or entrepreneurship, not with growth in quality of life, at least outside of the West. It is also found that skills seem to have depressed housing supply growth in the West, but not in other regions, which supports the view that educated residents in that region have fought for tougher land-use controls. Evidence is also presented that skills have had a disproportionately large impact on unemployment during the current recession.

Suggested Citation

  • Edward L. Glaeser & Giacomo A. M. Ponzetto & Kristina Tobio, 2014. "Cities, Skills and Regional Change," Regional Studies, Taylor & Francis Journals, vol. 48(1), pages 7-43, January.
  • Handle: RePEc:taf:regstd:v:48:y:2014:i:1:p:7-43
    DOI: 10.1080/00343404.2012.674637
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    More about this item

    JEL classification:

    • D00 - Microeconomics - - General - - - General
    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General

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