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Consumption amenities and city crowdedness

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Listed author(s):
  • Jordan Rappaport

Abstract

Crowdedness varies widely among U.S. cities. A simple, static general equilibrium model suggests that plausible differences in metro areas’ consumption amenities can account for much of the observed variation. Under a baseline calibration, differences in amenities valued at 30 percent of average consumption expenditures suffice to support a twenty-fold difference in population density. Empirical results confirm that amenities help support crowdedness and suggest that they are becoming a more important determinant of where people choose to live. But for the moment, local productivity appears to be the more important cause of local crowdedness.

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Paper provided by Federal Reserve Bank of Kansas City in its series Research Working Paper with number RWP 06-10.

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Date of creation: 2006
Handle: RePEc:fip:fedkrw:rwp06-10
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Keywords: Productivity ; Consumption (Economics);

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Cited by:

  1. Morris A. Davis & Francois Ortalo-Magne, 2011. "Household Expenditures, Wages, Rents," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 14(2), pages 248-261, April.

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