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The Geography of Structural Transformation: Effects on Inequality and Mobility

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  • Takeda, Kohei

    (National University of Singapore)

Abstract

Economies transform at an uneven pace. This paper develops a dynamic overlapping generations model of economic geography where historical exposure to different industries creates persistence in occupational structure, and non-homothetic preferences and differential productivity spillovers lead to different rates of structural transformation. The model is calibrated to the U.S. economy from 1980 to 2010. The calibration allows us to back out measures of upward mobility and inequality, thereby providing theoretical underpinnings for the Great Gatsby Curve. The counterfactual analysis reveals that structural transformation has substantial effects on a slowdown and explains heterogeneity in upward mobility across cities.

Suggested Citation

  • Takeda, Kohei, 2023. "The Geography of Structural Transformation: Effects on Inequality and Mobility," OSF Preprints 8nfx5, Center for Open Science.
  • Handle: RePEc:osf:osfxxx:8nfx5
    DOI: 10.31219/osf.io/8nfx5
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    More about this item

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies

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