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Urban cultural amenities and the migration of the creative class

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  • Dalvai, Wilfried

Abstract

This paper models the migration of the Creative Class (Florida, 2003) in a New-Economic-Geography framework. Beside wage differentials, urban cultural amenities play an important role on the choice of location. A public cultural good, financed by taxes, is introduced as an agglomeration force. The public-good is purely consumed by skilled workers. Additionally urban cultural diversity across cities is taken into account to model exogenous differences between cities. I analyze the political equilibrium of tax competition. Furthermore the effects of asymmetries of cities and trade liberalization is examined. There is an optimal level of provision of public cultural goods. In the dispersion-scenario the equilibrium tax rate for workers is hump-shaped with respect to trade integration while for skilled workers it is u-shaped. In the core-periphery scenario the equilibrium tax rate for the core decreases with increasing trade freeness.

Suggested Citation

  • Dalvai, Wilfried, 2016. "Urban cultural amenities and the migration of the creative class," Thuenen-Series of Applied Economic Theory 143, University of Rostock, Institute of Economics.
  • Handle: RePEc:zbw:roswps:143
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    References listed on IDEAS

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    1. Donald R. Davis & Jonathan I. Dingel, 2012. "A Spatial Knowledge Economy," NBER Working Papers 18188, National Bureau of Economic Research, Inc.
    2. Rikard Forslid & Gianmarco I.P. Ottaviano, 2003. "An analytically solvable core-periphery model," Journal of Economic Geography, Oxford University Press, vol. 3(3), pages 229-240, July.
    3. Boualam, Brahim, 2014. "Does culture affect local productivity and urban amenities?," Regional Science and Urban Economics, Elsevier, vol. 46(C), pages 12-17.
    4. James E. Rauch, 1993. "Does History Matter Only When It Matters Little? The Case of City-Industry Location," The Quarterly Journal of Economics, Oxford University Press, vol. 108(3), pages 843-867.
    5. Richard Baldwin & Rikard Forslid & Philippe Martin & Gianmarco Ottaviano & Frederic Robert-Nicoud, 2005. "Economic Geography and Public Policy," Economics Books, Princeton University Press, edition 1, number 7524.
    6. Baldwin, Richard E. & Krugman, Paul, 2004. "Agglomeration, integration and tax harmonisation," European Economic Review, Elsevier, vol. 48(1), pages 1-23, February.
    7. Fritsch, Michael & Stützer, Michael, 2008. "The Geography of Creative People in Germany," MPRA Paper 21965, University Library of Munich, Germany.
    8. Berliant, Marcus & Peng, Shin-Kun & Wang, Ping, 2002. "Production Externalities and Urban Configuration," Journal of Economic Theory, Elsevier, pages 275-303.
    9. Fabien Candau, 2008. "Entrepreneurs' Location Choice And Public Policies: A Survey Of The New Economic Geography," Journal of Economic Surveys, Wiley Blackwell, vol. 22(5), pages 909-952, December.
    10. Richard Florida & Charlotta Mellander, 2010. "There goes the metro: how and why bohemians, artists and gays affect regional housing values," Journal of Economic Geography, Oxford University Press, vol. 10(2), pages 167-188, March.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Creative Class; New Economic Geography; Agglomeration; Urban Cultural Amenities; Public Cultural Goods; Tax Competition;

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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