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What’s In a City?: Understanding the Micro-Level Employer Dynamics Underlying Urban Growth

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  • R. Jason Faberman

    () (U.S. Bureau of Labor Statistics)

Abstract

This paper synthesizes the literatures on labor dynamics and urban growth and agglomeration by presenting new evidence on the micro-level establishment dynamics of metropolitan areas. I explore how the patterns of job reallocation and entry and exit affect the growth and composition of these areas. I find that high-growth metropolitan areas have high rates of job and establishment turnover, primarily though higher rates of gross job creation and establishment entry, and have a relatively young distribution of establishments. Variations in the age distribution and differences in the entry and exit patterns of young establishments account for a sizeable portion of regional differences in labor dynamics and growth, even after controlling for regional differences in industry composition. These results suggest that variations in the age distribution and the dynamics that lead to such variations are important factors in understanding urban growth and agglomeration.

Suggested Citation

  • R. Jason Faberman, 2005. "What’s In a City?: Understanding the Micro-Level Employer Dynamics Underlying Urban Growth," Working Papers 386, U.S. Bureau of Labor Statistics.
  • Handle: RePEc:bls:wpaper:ec050120
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    References listed on IDEAS

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    Cited by:

    1. Sato, Yasuhiro & Zenou, Yves, 2015. "How urbanization affect employment and social interactions," European Economic Review, Elsevier, vol. 75(C), pages 131-155.
    2. Gilles Duranton, 2011. "California Dreamin': The Feeble Case for Cluster Policies," Review of Economic Analysis, Rimini Centre for Economic Analysis, vol. 3(1), pages 3-45, July.
    3. Adrián G. de la Garza Treviño, 2008. "Do Smart Cities Grow Faster?," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(2), pages 1-28, November.
    4. Rui Baptista & Joana Mendonça, 2010. "Proximity to knowledge sources and the location of knowledge-based start-ups," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 45(1), pages 5-29, August.
    5. John Francis, 2009. "Agglomeration, job flows and unemployment," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 43(1), pages 181-198, March.

    More about this item

    Keywords

    Job Reallocation; Urban Growth and Agglomeration; Firm Dynamics;

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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