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A productivity model of city crowdedness

  • Jordan Rappaport

Population density varies widely across U.S. cities. A simple, static general equilibrium model suggests that moderate-sized differences in cities’ total factor productivity can account for such variation. Nevertheless, the productivity required to sustain above-average population densities considerably exceeds estimates of the increase in productivity caused by such high density. In contrast, increasing returns to scale may be able to sustain multiple equilibria at below-average population densities.

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Paper provided by Federal Reserve Bank of Kansas City in its series Research Working Paper with number RWP 06-06.

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Date of creation: 2006
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Handle: RePEc:fip:fedkrw:rwp06-06
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  1. Antonio Ciccone & Robert E. Hall, 1993. "Productivity and the Density of Economic Activity," NBER Working Papers 4313, National Bureau of Economic Research, Inc.
  2. Edward L. Glaeser & Matthew E. Kahn, 2003. "Sprawl and Urban Growth," NBER Working Papers 9733, National Bureau of Economic Research, Inc.
  3. Jackson, Jerry R. & Johnson, Ruth C. & Kaserman, David L., 1984. "The measurement of land prices and the elasticity of substitution in housing production," Journal of Urban Economics, Elsevier, vol. 16(1), pages 1-12, July.
  4. Jordan Rappaport, 2006. "A productivity model of city crowdedness," Research Working Paper RWP 06-06, Federal Reserve Bank of Kansas City.
  5. Ciccone, Antonio, 2002. "Agglomeration effects in Europe," European Economic Review, Elsevier, vol. 46(2), pages 213-227, February.
  6. Kim, Sukkoo, 1999. "Regions, resources, and economic geography: Sources of U.S. regional comparative advantage, 1880-1987," Regional Science and Urban Economics, Elsevier, vol. 29(1), pages 1-32, January.
  7. Davis, Morris & Heathcote, Jonathan, 2005. "The Price and Quantity of Residential Land in the United States," CEPR Discussion Papers 5333, C.E.P.R. Discussion Papers.
  8. McDonald, John F., 1981. "Capital-land substitution in urban housing: A survey of empirical estimates," Journal of Urban Economics, Elsevier, vol. 9(2), pages 190-211, March.
  9. Ermisch, J. F. & Findlay, J. & Gibb, K., 1996. "The Price Elasticity of Housing Demand in Britain: Issues of Sample Selection," Journal of Housing Economics, Elsevier, vol. 5(1), pages 64-86, March.
  10. Combes, Pierre-Philippe & Duranton, Gilles & Gobillon, Laurent, 2008. "Spatial wage disparities: Sorting matters!," Journal of Urban Economics, Elsevier, vol. 63(2), pages 723-742, March.
  11. J.V. Henderson, 1972. "The Sizes and Types of Cities," Working Papers 75, Queen's University, Department of Economics.
  12. Thorsnes, Paul, 1997. "Consistent Estimates of the Elasticity of Substitution between Land and Non-Land Inputs in the Production of Housing," Journal of Urban Economics, Elsevier, vol. 42(1), pages 98-108, July.
  13. Dale Jorgenson & Mun Ho & Kevin Stiroh, 2003. "Growth of US Industries and Investments in Information Technology and Higher Education," Economic Systems Research, Taylor & Francis Journals, vol. 15(3), pages 279-325.
  14. Rosenthal, Stuart S. & Strange, William C., 2004. "Evidence on the nature and sources of agglomeration economies," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 49, pages 2119-2171 Elsevier.
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